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Private sector Yes Bank has received another round of USD 150 million funding from US government and Wells Fargo to fund SME lending. This is the third round of funding as part of arrangement between the Overseas Private Investment Corporation (OPIC) -- US government development finance institution -- and Wells Fargo, with the objective to increase lending to small and medium enterprises in India. OPIC will provide USD 75 million in financing to Yes Bank and up to USD 75 million as a syndicated financing from Wells Fargo Bank, a part of financial services provider Wells Fargo & Company. This is the third transaction between OPIC and Yes Bank and comes close on the heels of last year's USD 265 million OPIC facility, which the bank will use to extend SME financing in India, Yes Bank said in regulatory filing. "Specifically, USD 50 million of the financing would be used to expand support to women-owned businesses, while another USD 50 million will be used for financing small and medium enterprises (SME) in low income states," it said. SMEs contribute about 45 per cent of industrial output and employ 42 million people in the country.
It is estimated that 3 million women owned businesses in India employ over 8 million people. However, only about a quarter of them are able to get the finance they need to grow and create jobs, Yes Bank said. "OPIC's facility will help Yes Bank expand its SME lending capacity, specifically enabling them to reach both women and entrepreneurs in low income states who have much to contribute to India's economic growth," Dev Jagadesan, OPIC Acting President and CEO said.
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