Business Standard

Cholamandalam Investment gets USD 222 mn investment from IFC


Press Trust of India Mumbai
Financial services company Cholamandalam Investment Wednesday said it has received an investment of USD 222 million (about Rs 1,550 crore) from IFC, a member of the World Bank Group, to finance micro and small borrowers in rural and semi-urban parts of the country.
Of the total amount, USD 92 million is from International Finance Corporation's (IFC) own account, while the rest is syndicated from First Abu Dhabi Bank (USD 50 million), MUFG Bank (USD 50 million), National Bank of Ras Al-Khaimah PJSC (USD 20 million), and CTBC Bank Co (USD 10 million).
"IFCs strong commitment to the NBFC (non-banking financial company) space and support in helping us access credit from foreign investors will reinforce the important role played by the NBFC sector in providing last-mile credit," Cholamandalam Investment and Finance Company Ltd (CIFCL) said in a statement.
This is CIFCL's first US dollar-syndicated deal since January 2019, when the Reserve Bank of India permitted NBFCs to tap into the offshore credit market.
The investment also diversifies CIFCL's funding sources.
"Supporting productive asset financing NBFCs is part of our financial inclusion strategy because it offers income opportunities and an escape from poverty to low-income households," IFC's country head (India) Jun Zhang said in the statement.
CIFCL's wide reach amongst small road transport operators and MSMEs (micro, small and medium enterprises) makes it the right partner for IFC to reach the underserved segments, he said.
IFC first invested in CIFCL in 2010 and again in 2014.
Between 2011 and 2017, CIFCL reached 126,000 SMEs and 6.5 million micro-borrowers.
The new funds will help the company expand its reach and create jobs, the statement said.

Disclaimer: No Business Standard Journalist was involved in creation of this content

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: May 29 2019 | 5:30 PM IST

Explore News