An INR 250 Million Series B investment in Utkarsh Microfinance Pvt. Limited has been led by the Norwegian Microfinance Initiative’s Frontier Fund KS. Utkarsh is a Non-Banking Finance Company (NBFC), with operations in 13 districts of Uttar Pradesh and Bihar. It has a client base of 57, 000, with a loan portfolio of INR 410 million.
The participants in this Series B round of investment included Aavishkaar Goodwell (AG), which is an existing investor in the MFI. Utkarsh also has World Bank’s IFC as an existing investor, which has been supporting the firm since March 2010. The only advisor for this transaction was Intellecap.
The Norwegian public and private sectors have formed a strategic partnership, Norwegian Microfinance Initiative (NMI), which aims to help microfinance institutions (MFIs) in developing countries, by providing them technical support and professional assistance.
Govind Singh, MD and CEO, Utkarsh, said,”The investment of INR 250 mn is going to boost our growth plans. It has come at the right time as the sector has started growing once again. It is also noteworthy that our existing investors AG are participating in this round, strongly indicating their confidence in the sector and in Utkarsh. We’re also very grateful for IFC’s continued support. Another important aspect is that all our investors have a strong bent for social sector and truly believe in double bottom-line approach. We strongly believe that this investment will facilitate further penetration of microfinance in the most underpenetrated geography in the country.”
Henning Haugerudbråten, Investment Director, NMI Frontier Fund, announced, “We are very pleased to invest with Utkarsh and to be part of the important work that the Company is doing toward financial inclusion in northern India. NMI was particularly attracted by Utkarsh’s commitment to serving the poor in areas of India characterized by high population, high incidence of poverty, and very low financial inclusion. The potential for well-run MFIs like Utkarsh to make an impact in this region is tremendous, and we believe Utkarsh has the professionalism and commitment required to make a difference and to achieve the joint mission of Utkarsh and NMI on financial inclusion, This investment is also an attractive complement to NMI’s other activities in India,”
Anurag Agrawal, Co-Founder Intellecap, and Senior Vice President of the Investment Banking arm said, “Utkarsh is doing some great work in promoting financial inclusion among low income communities, and Intellecap is very happy to have played a role in their mission. This investment by NMI in Utkarsh is a reinforcement of our belief that, in spite of all that has happened over the last year or so in the microfinance sector, there is still a fundamental business proposition for microfinance in India and informed global investors are willing to commit significant capital to quality institutions who are doing good work on the ground to serve the large unmet demand for microfinance services. We are optimistic that this space will see gradual growth over the next few years, as it adapts to a changed regulatory environment”.
