A business journalist-turned-author teamed up with IIFL Wealth to chronicle how the new wave of rich Indians behave and set new rules in wealth management.
It took India 60 years to reach a GDP of $1 trillion, while it took just six years for the country's economic output to exceed $2 trillion. The pace at which the newly-wealthy people are joining the high-net-worth individual (HNI) ranks is unprecedented, said Shreyasi Singh, who launched her book 'The Wealth Wallahs' in New Delhi.
Attending the event in Delhi as a special guest was Minister of State for Civil Aviation Jayant Sinha.
Singh interviewed about 100 HNIs for the book. Some of the notable newly rich are champions of India's startup revolution. They include Vijay Shekhar Sharma, founder of Paytm, one of the highest funded startups in India; Kunal Shah, founder of FreeCharge and one of the top angel investors for this year, and Neeru Sharma, cofounder of Infibeam, one of handful of Indian internet companies to go IPO.
It took her four months to write the book, followed by three months of editing.
"Sometimes I had to wait for my busy subjects maybe around hour or two to finish their work so I can interview them. That time helped me clear my mind and really zone in on what’s different between the new money people and people who come from traditionally very wealthy families. These first generation rich people, usually who grew up in a middle class family didn’t think of themselves as wealthy, even those with 100 crore worth. They would ask why I would try to interview them," she said.
As a benchmark, Singh set an investable wealth exceeding $5 million to categorize a person as a "wealth wallah".
She explained that the new wealth wallahs were very much like "you and I", despite the ostentatiousness of the most expensive wedding, Panama papers and other scandals making all the rich people seem party to the same lifestyle.
The Infibeam cofounder said that when demonetization struck people thought that "we wouldn’t be affected" but "I had to break into my daughter’s piggy bank in search of valid money."
Singh said not all wealthy are "immoral" and impressed with the fastest cars and the biggest mansions.
Also speaking on the occasion was Karan Bhagat of IIFL Wealth.
"One big difference with the newly rich and the traditionally wealthy is that the former are more proactive about investing their money, about asset allocation and are interested in investing in startups. They also tend to avoid micro managing their assets under management," he said.
"In contrast, the traditionally wealthy look at wealth managers as a way to preserve their wealth, not grow their wealth. It’s this behaviour that has made asset managers just that - and not wealth-enriching institutions. However, with the new rich joining the ranks this is changing."
Minister Sinha took the opportunity to speak on how giving back to society is important.
"In India, it has been ingrained in our minds that it's okay to under-declare your income, especially by small and medium scale businesses. That it's okay to overstate your expenses," he said.
"Liquidity of assets gives you more power to be philanthropic. We must remember to set aside a fair amount for what’s due in way of taxes, to society and to our families to take care of them. It’s equally important to reinvest in the economy," the minister said.
BW Reporters
Regina is a reporter for BW Businessworld. In her previous assignments, she has worked with Independent television Network as a news anchor and reporter in Sri Lanka
