MICROCAPITAL BRIEF: Fusion Microfinance of India Raises $12m in Equity from Creation Investments, Oikocredit, Gawa Capital

Fusion Microfinance, a lender to groups of women in India, recently raised INR 800 million (USD 12.4 million) in unspecified portions from US-based Creation Investments, Netherlands-based Oikocredit and Spain-based Gawa Capital Partners. All three of the investors were already shareholders in the microlender. Fusion plans to use the cash to invest in “the latest technology to bring down overall operational costs” and boost its staffing from 3,000 to 4,000 over the next year.

Launched in 2010, Fusion focuses on rural areas in northern and central India. It offers loans of up to INR 50,000 (USD 780) with terms of up to 2 years. The interest rate is approximately 24.5 percent per year with a 1 percent fee and the cost of insurance passed through with no markup. Fusion also offers emergency loans of up to INR 5,000 (USD 78) at an annualized rate of 22 percent for up to 8 months. The microlender has 358 branches and a gross loan portfolio of INR 14 billion (USD 218 million) as of 2018.

The mission of Creation Investments is to alleviate global poverty by making direct, for-profit investments in organizations that engage in economic development. Headquartered in the US city of Chicago, it holds investments in Eurasia and the Americas as of 2018. As of 2016, it managed three financial inclusion funds with a total of USD 275 million in committed capital as well as USD 50 million in other direct investments.

Founded in 1975, Oikocredit is a cooperative that invests in microfinance, fair trade, agriculture and renewable energy. As of September 2017, it has EUR 935 million (USD 1.15 billion) in capital invested in 780 partners in 70 countries.

Gawa Capital Partners is a Spain-based investment advisory company specializing in microfinance. Founded in 2009 by Agustin Victoria and Luca Torre, Gawa most often has made investments ranging from EUR 1 million (USD 1.25 million) to EUR 3.5 million (USD 4.37 million). As of 2018, its Gawa Microfinance Fund and Global Financial Inclusion Fund hold assets totaling EUR 53 million (USD 65 million).

Sources and additional resources

Live Mint article
http://www.livemint.com/Companies/zrLb2hVo7hHx88HCzxOLeI/Fusion-Microfinance-raises-funds-from-existing-investors.html

About Oikocredit
https://www.oikocredit.coop/what-we-do/investment-areas/microfinance

Gawa funds
http://www.gawacapital.com/Investment-funds/GAWA-Microfinance-Fund

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