MICROCAPITAL BRIEF: SEWA Affiliate Sitara Raises $20m in Equity from Nordic Microfinance Initiative, Women’s World Banking, Ongoing Shareholders to Improve Housing Conditions for Women in India

SEWA Grih Lin, an Indian affordable housing finance company also known as Sitara, recently raised USD 20 million in equity, including USD 8 million from the Norway-based Nordic Microfinance Initiative (NMI). Sitara sourced the remainder in unspecified portions from the asset management unit of US-based Women’s World Banking (WWB), India’s Housing Development Finance Corporation, Netherlands-based Oikocredit and the US-based Omidyar Group’s Omidyar Network India. Of these, the latter three had invested in Sitara previously.

Sitara plans to use the new funding to expand its services to more clients, including in new locations. As of 2022, the organization serves 15,000 customers in eight states. Its goal is to serve an additional 7,000 people by March 2023 with loans totaling INR 5.0 billion (USD 65 million), expanding its portfolio to INR 7.7 billion (USD 100 million).

Founded in 2011, Sitara is an initiative of India’s Self Employed Women’s Association (SEWA) that issues loans for purchasing, building and improving homes primarily to women living in cities in northern and western parts of the country. These improvements include installations such as running water, sanitation systems and sturdier roofing. Most of Sitara’s loans range in size from INR 50,000 (USD 625) to INR 1.2 million (USD 15,000) with an interest rate of 18 percent per annum and a maximum tenor of 20 years. The lender’s other services include helping its clients establish formal land title and disbursing loans using real estate as collateral for enterprise, schooling and personal use.

SEWA is an organization of “poor, self-employed women workers” whose goal is “to organise women workers for full employment… whereby workers obtain work security, income security, food security and social security (at least health care, child care and shelter).” Founded in 1972, SEWA has a range of programs addressing areas such as research, training, financial inclusion and building social businesses to boost employment. The organization had 1.7 million members as of 2020.

NMI was founded in 2008 with the goal of creating jobs and wealth via financial inclusion. The organization manages five funds holding aggregate assets of about USD 350 million as of 2022. These include four microfinance funds and a climate fund encouraging “Indonesian smallholders [to] intensify work on their existing plots instead of clearing rainforest.” NMI is owned by Norfund, which is backed by the government of Norway; the Danish Investment Fund for Developing Countries, which is known by its Danish acronym IFU; and eight private companies. The organization has offices in Denmark, India, Indonesia, Kenya and Norway.

WWB is a nonprofit that works with financial services providers, individual practitioners and regulators to to boost financial services for women in low- and middle-income countries. Its subsidiary WWB Asset Management holds equity investments valued at USD 150 million. It has 12 funders and 10 ongoing holdings as of 2022.

By Ben Greissman, Research Associate

Sources and Additional Resources

NMI press release
https://www.nmimicro.no/news/nmi-invests-usd-8-million-equity-in-sitara-supporting

Sitara homepage
https://www.sgrlimited.in

Sitara financials
https://www.sgrlimited.in/financials-and-notice.php

Sitara product offerings
https://www.sgrlimited.in/products.php

SEWA homepage
https://www.sewa.org

WWB homepage
https://www.womensworldbanking.org

NMI homepage
https://www.nmimicro.no

Housing Development Finance Corporation homepage
https://www.hdfc.com

Oikocredit homepage
https://www.oikocredit.coop

Omidyar homepage
https://omidyar.com