MICROCAPITAL BRIEF: Grama Vidiyal Microfinance of India Borrows from World Business Capital

Grama Vidiyal Microfinance, a microfinance institution (MFI) operating in the Indian state of Tamil Nadu, has raised an undisclosed amount of financing through both senior and subordinate loans from World Business Capital, a US-based lender to small and medium-sized enterprises (SMEs). Avendus Capital, an Indian investment bank, acted as Grama Vidiyal’s financial adviser for the transaction. The financial terms of the transaction have not been disclosed.

As of March 31, 2013, Grama Vidiyal reported to the US-based nonprofit data provider Microfinance Information Exchange (MIX) total assets of USD 112 million, a gross loan portfolio of USD 99.7 million, approximately 738,000 borrowers, return on assets of 0.56 percent and return on equity of 3.33 percent. The institution does not accept deposits.

By A’kos Szebeni, Research Associate

About Grama Vidiyal Microfinance

Grama Vidiyal is a microfinance institution based in the city of Tiruchi, in the Indian state of Tamil Nadu. Since 1993, Grama Vidiyal, in partnership with Activists for Social Alternatives (ASA), has provided small loans to women without access to formal credit and who typically have daily incomes of less than INR 80 (USD 2) per day. As of March 31, 2013, Grama Vidiyal reported to the US-based nonprofit data provider Microfinance Information Exchange (MIX) total assets of USD 112 million, a gross loan portfolio of USD 99.7 million, approximately 738,000 borrowers, return on assets (ROA) of 0.56 percent and return on equity (ROE) of 3.33 percent. The institution does not accept deposits.

About World Business Capital (WBC)

World Business Capital (WBC) is a commercial finance company that offers loans to small and medium-sized enterprises (SMEs) globally. It was founded in 2003 and is headquartered in the US city of Hartford, Connecticut. WBC’s clients include companies with revenues in the range of USD 10 million to USD 150 million in sectors that include manufacturing and distribution, packaging, food processing and agribusiness, logistics and transportation, renewable resources, and financial institutions. Financial information on the firm is not available.

About Avendus Capital

Avendus Capital is an investment bank in India that provides financial services in the areas of financial advisory, capital markets, wealth management and alternative asset management to clients including institutional investors, corporations and high-net-worth families. Financial information on the firm is not available.

Sources and Additional Resources:

Avendus Capital Press Release, “Avendus Capital advises Grama Vidiyal Microfinance Ltd on raising long-term senior and subordinated facilities from WorldBusiness Capital, Inc.” http://www.worldbusinesscapital.com/wp-content/uploads/2014/01/India-Avendus-Capital-Advises-Grama-Vidiyal-Press-Release-January-3-2014.pdf

MicroCapital, July 5, 2011, “Avendus Capital of India Buys $2.4m in Securitized Loans from Grama Vidiyal Microfinance,” https://www.microcapital.org/13505/

MicroCapital, October 1, 2010, “Avendus Capital of India Invests $8.25m in Securitized Microloans,” https://www.microcapital.org/microcapital-brief-avendus-capital-of-india-invests-8-25m-in-securitized-microloans/

MicroCapital, December 17, 2009, “Intellecap’s 2009 Srijan Awards Go to Arohan, Grama Vidiyal, Sahayata Microfinance, Vortex Engineering,” https://www.microcapital.org/microcapital-brief-intellecaps-2009-srijan-awards-go-to-arohan-grama-vidiyal-sahayata-microfinance-vortex-engineering/

MicroCapital, August 13, 2009, “Microfinance Institution Grama Vidiyal to Raise $21m in Non-convertible Debentures,” https://www.microcapital.org/news-wire-india-microfinance-institution-grama-vidiyal-to-raise-21m-in-non-convertible-debentures/

MicroCapital, June 25, 2009, “Grama Vidiyal Micro Finance Limited (GVMFL) Raises USD 4.25 million from MicroVest, Unitus Equity Fund, and Amar Foundation,” https://www.microcapital.org/microcapital-story-grama-vidiyal-micro-finance-limited-gvmfl-raises-usd-425-million-from-microvest-unitus-equity-fund-and-amar-foundation/

MicroCapital Universe Profile: Grama Vidiyal Microfinance, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Grama+Vidiyal

MicroCapital Universe Profile: World Business Capital, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=World+Business+Capital+%28WBC%29

MicroCapital Universe Profile: Avendus Capital, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Avendus+Capital

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