Asirvad Micro Finance Limited, a microlender in India, recently accepted a loan of USD 15 million from WorldBusiness Capital, a US-based finance company. The seven-year loan, which is guaranteed by the government-backed US International Development Finance Corporation (DFC), is to be used for on-lending to low-income women who operate rural enterprises.
Founded in 2008, Asirvad is a subsidiary of India’s Manappuram Finance that provides gold loans as well as lending individually and in groups to micro-, small and medium-sized enterprises (MSMEs) in 22 states. The microfinance loans typically range in size from INR 2,500 (USD 34) to INR 50,000 (USD 690) with repayment periods of 12 months to 24 months. The loans for larger firms range up to INR 1.5 million (USD 20,500), with a maximum tenor of seven years.
During the year ending March 2020, Asirvad generated return on equity of 26 percent and return on assets of 4.6 percent, ending the period with total assets of INR 59.1 billion (USD 814 million), 1,000 branches and 2 million customers. In addition to those offered by Asirvad, Manappuram Finance offers financing for housing, vehicles and equipment. The parent company, which was founded in 1949, operates 4,600 branches in 24 states and held assets of INR 238 billion (USD 3.27 billion) as of March 2020.
Founded in 2003, WorldBusiness Capital is a direct lender to midsize businesses in the manufacturing, logistics, packaging, franchising, equipment and financial sectors. It typically issues loans with terms of 5 years to 20 years to borrowers with annual revenues of USD 10 million to USD 200 million and total assets of USD 25 million to USD 500 million.
Founded in 2019, DFC partners with private institutions to invest in the energy, healthcare, infrastructure and technology sectors. Among its goals is to reach small businesses and women entrepreneurs to support job creation in emerging markets. As of September 2020, DFC’s assets amounted to USD 12.0 billion with a total of USD 2.5 billion disbursed in 106 countries during the previous year.
By Teo Lin-Bianco, Research Associate
Sources and Additional Resources
DFC project summary
https://www.dfc.gov/sites/default/files/media/documents/9000103853.pdf
DFC projects press release
https://www.dfc.gov/media/press-releases/dfc-approves-36-billion-new-investments-global-development-largest-quarter
Asirvad homepage
https://asirvadmicrofinance.co.in/
Asirvad 2019-2020 annual report
https://amlcdn.b-cdn.net/img/13th-Annual-Report-Inner-Page-2020-Low-Res.pdf
Asirvad information page
https://www.creditmantri.com/asirvad-microfinance/
Manappuram Finance homepage
https://www.manappuram.com/
Manappuram Finance 2019-2020 annual report
https://www.manappuram.com/public/uploads/editor-images/files/ManappuramAnnualReport2020.pdf
WorldBusiness Capital homepage
https://www.worldbusinesscapital.com/
DFC homepage
https://www.dfc.gov/
DFC 2019-2020 annual report
https://www.dfc.gov/sites/default/files/media/documents/DFC_2020_Annual_Report.pdf
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