The Asian Development Bank (ADB) undertook an equity investment of approximately $20 million in Annapurna Finance Private Limited (Annapurna), one of India’s largest microfinance institutions (MFIs), to increase its capital base and enhance its lending operations by offering finance to women and micro and small enterprises in the country’s rural areas.
“Women, particularly in the rural areas in India, still have difficulty in accessing capital, which limits their potential and prevents them from contributing significantly to inclusive and sustainable growth,” said ADB Principal Investment Specialist for Private Sector Operations Mr. Paul Flegler. “ADB’s support to Annapurna will expand its lending portfolio, helping ensure that rural women and micro and small enterprises needing capital can have better access to finance.”
Access to credit in India is limited. Only 16.5% of borrowers in rural areas access credit through formal channels, with the figure even lower for women. Businesses owned by low-income women often can’t obtain credit as they lack collateral and financial documents and may be unfamiliar with paperwork and procedures.
The financing will also enable Annapurna to provide loans to individuals, micro and small enterprises, as well as women looking for affordable housing loans in semi-urban and rural areas of lagging states. Unitus Capital acted as the exclusive investment advisor for the transaction.
Original source: ADB
Published on 04 February 2019
