IFC to make debt investment in CreditAccess Grameen

CreditAccess Grameen Ltd, India’s largest microfinance institution, is raising up to $50 million (Rs 388 crore) in debt from International Finance Corporation to expand its lending activities.

IFC, the private-sector investment arm of the World Bank Group, said in a disclosure the proposed three-year senior loan will help CreditAccess Grameen to grow its portfolio to women borrowers for income generation purposes, specifically in the low-income states and rural areas of India.

Mumbai-listed CreditAccess Grameen is headquartered in Bengaluru. It operates in 14 Indian states and one union territory through 1,635 branches and has a base of 3.8 million women borrowers. The microlender had a gross loan portfolio of $2.2 billion and a net worth of $543 million as on March 31.

The microfinance institution is 74% owned by CreditAccess India while public shareholders hold the remaining stake.

CreditAccess India is an investment company based in Amsterdam, with more than 220 shareholders including Olympus Capital Asia (15%), Asian Development Bank (9%), family offices and wealthy individuals.

CreditAccess Grameen, which previously operated as Grameen Koota, went public four years ago. It provides group lending products as well as retail finance products, and focuses solely on female customers. It also offers access to non-financial services such as customer awareness and education programmes and sanitation efforts.

The proposed IFC loan is at least the third time that the microlender is raising debt capital from an overseas investor over the past year.

In July last year, Swedish development finance Institution Swedfund provided $25 million in debt funding to CreditAccess Grameen. In April last year, the microlender raised Rs 71 crore ($9.5 million) by issuing non-convertible debentures to Global Access Fund LP. The fund is managed by WaterEquity Inc, an impact investment asset manager co-founded by Hollywood actor Matt Damon.