L&T Finance Holdings inks pact with JICA for $125 million funding

Non-banking financial company (NBFC) L&T Finance Holdings on Tuesday signed a financing pact with Japan International Cooperation Agency (JICA) for $125 million to support financing in rural and peri-urban areas in India.

In November 2023, L&T Finance had sourced a $125 million loan from the Asian Development Bank (ADB), and as part of the co-financing agreement, an additional $125 million loan is now being raised from JICA.

At least 40 per cent of the proceeds will be allocated for women borrowers, while the rest will be allocated to support farmers, micro, small and medium enterprises (MSMEs), as well as loans to purchase new two-wheeler vehicles including electric two-wheelers.

The project is strategically aligned with the goals of the Ministry of Rural Development as it focuses on lending in rural and peri-urban areas of lagging Indian states.

Commenting at the signing ceremony, Sachinn Joshi, Chief Financial Officer of L&T Finance, said, “Our collaboration with JICA resonates deeply with our commitment to driving sustainability and positive business impact. We view this partnership as a substantial step towards bridging the financial gap and fostering inclusive economic growth nationwide through sustainability-focused loans.”

“This long-term loan also helps us take forward our ongoing strategy of diversifying funding sources for the company. By concentrating on lending in rural and peri-urban areas of lagging states, our project strategically aligns with the goals of India’s Ministry of Rural Development,” he added.