by Melissa Alvarez - South Asia, East Asia and Pacific -

PRESS RELEASE: India: Microfinance Sector Continues to Beat Global Economic Crisis

Source: Grameen Capital

This press release is not available online. 

MUMBAI, INDIA April 08 – Bandhan, IndusInd Bank and Grameen Capital India confirmed today having recently completed a Rs. 75 crore portfolio assignment of microfinance receivables. This transaction was structured and arranged by Grameen Capital India and comprised a poolof advances to the agricultural and allied sectors made by Bandhan-Konnagar and BandhanFinancial Services Private limited.

Bandhan offered a pool of assets amounting to Rs. 75 crore for assignment to IndusInd Bankunder this transaction, as per the Bank’s selection criteria. Bandhan has signed a managementand collection agreement with the bank and would continue to administer these loans andchannel the collections to the bank.

Over the last few years, the ‘originate to distribute’ approach has opened up an additional source of capital for the Indian microfinance sector. Over the last 12 months or so, GrameenCapital has helped MFIs raise over Rs. 300 crore using primarily this approach. Bandhanintends to raise over Rs.600 crore in the current financial year, a bulk of which will comefrom a combination of this approach and raising capital from other classes of investors.

Royston Braganza, CEO, Grameen Capital India said, “This transaction is anotherdemonstration that the Microfinance sector continues to be strong even in the prevailingeconomic environment. The granularity of the portfolio, income generating nature of theloans (i.e. the ‘real’ economy) and intensive contact with the borrowers are key factors whichcontribute to the robustness of the sector. We are thrilled to bring Bandhan and IndusIndtogether for this transaction (incidentally, Bandhan means ‘togetherness’)”.

“It’s our first work with IndusInd and we are happy to have started in a big way. Of coursewe are friends with Grameen Capital India for quite some time. Though Bandhan has beenraising substantial funds even in the meltdown situation, but every deal is important for ussince it helps us to reach out to more poor. We look forward to strengthening thisrelationship”, Chandra Shekhar Ghosh, Founder and CEO of Bandhan added.

Speaking on this transaction, Roopa Satish, Head- Corporate & Investment bank forIndusInd Bank, added, “The deal fits in well with the strategy of the bank to pursueactivities and businesses which have an element of sustainability”.Post a successful closure of this transaction, Bandhan and Grameen Capital plan to worktogether on suitable structured finance solutions, given the ambitious growth plans toaccelerate financial inclusion.

About Bandhan:

Bandhan is one of the largest and fastest growing Microfinance Institution in India, working through a strong network of 675 branches spread across 11 statesof the country. Since inception in July 2002, it has disbursed over Rs. 22 billion inmicroloans and presently has a microloan portfolio of over Rs. 7 billion spread over 1.5million customers, all women. Bandhan was ranked 2 nd globally and 1 st among Indian MFIs,in the first ever list of World’s top 50 Microfinance Institutions globally. Apart from baggingthe prestigious Skoch Challenger Award in the Financial Inclusion category in March 2008, ithas also received numerous awards and recognitions both nationally and internationally. Bandhan was founded by Chandra Shekhar Ghosh, Senior Ashoka Fellow, who has over twodecades of experience in Microfinance and Social development. Bandhan aims to reach out tonearly 8.5 million customers by Y2013.

About IndusInd Bank:

IndusInd Bank Ltd. is one of the new-generation private-sector banks in India which commenced its operations in 1994. The Bank currently has a network of 180 branches,spread over 147 geographical locations in 28 states and union territories across the country.The Bank also has a Representative Office each in Dubai and London.

The Bank is driven by state-of-the-art technology since its inception. It has multi-lateral tie-ups with other banks providing access to more than 18000 ATMs for its customers. It enjoysclearing bank status for both major stock exchanges – BSE and NSE – and three majorcommodity exchanges in the country – MCX, NCDEX, and NMCE. It also offers DPfacilities for stock and commodity segments.

IndusInd Bank has been awarded the highest A1+ rating for its Certificates of Deposit by ICRA and the highest P1+ rating for its Fixed Deposits and Certificates of Deposit by CRISIL.

In recent past, the Bank was awarded ‘The Smart Workplace’ Award by Economic Times inassociation with Acer and Intel for enhancing the productivity of the employees throughoptimum use of resources as well as technology.

About Grameen Capital India Limited:

Grameen Capital India enables Microfinance Institutions (MFIs) develop wider access to thecapital markets, primarily the domestic capital markets, through innovative debt and equitysolutions, credit rating/ enhancement arrangement and capital advisory services. It focuses on positioning Microfinance as an attractive asset class, helping MFIs raise low-cost on-lending funds. Since its launch in January 2008, it has facilitated flow of debt and equitycapital worth nearly Rs. 500 crores into the microfinance sector. Grameen Capital India is collaboration between Grameen Foundation, IFMR Trust and Citicorp Finance India Limited.

 

Similar Posts: