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| Sewa-promoted entity aims to set up NBFC | |
| Vinay Umarji / Ahmedabad December 01, 2009, 21:09 IST | |
With its micro finance portfolio expected to cross Rs 500 crore, Ahmedabad-based non-profit organisation Friends of Women’s World Banking (FWWB) is floating an NBFC, Ananya Finance for Inclusive Growth (AFIG). The NGO, promoted by Self Employed Women’s Association (Sewa) Bank, expects to receive the Reserve Bank of India (RBI)’s approval soon for the new entity.
Although the FWWB has been funding micro finance institutions (MFIs), the NGO was doing so on a low key so far. “We felt India’s poor women needed more access to finance and therefore we decided to get directly involved in micro finance by setting up an NBFC,” said Vijayalakshmi Das, chief executive officer of FWWB.
AFIG would now be funding MFIs across the country and would especially “under served states” like Madhya Pradesh, Uttarakhand, Bihar and North East states. Through the new entity, the organisation expects to raise its portfolio to over Rs 1000 crore in an year’s time.
Talking about rationale behind setting up an NBFC, Das said, “We could have set up a retail MFI on our own. But we found more scope in setting up an NBFC that works with hundreds of other MFIs across the country. Moreover, as an NGO we couldn’t have earned a profit but with an NBFC we can grow in terms of revenue in order to support more MFIs in future.”
Once FWWB receives RBI approval for AFIG, the NGO would transfer its MFI funding activities to the latter. Currently, FWWB supports around 140 MFIs across the country. FWWB is also scouting for ‘social investors’ in order to raise up considerable paid-up capital for AFIG. Already, the organisation has raised paid-up capital worth Rs 100 crore.
Through AFIG MFIs would receive 100 per cent financial exposure for the first two years and later the NBFC would reduce the extent of its support, added Das.
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