Caspian Debt, the lending arm of India-focussed impact firm Caspian Impact Investment Adviser, has partnered with Chennai-based social enterprises incubator Villgro to provide debt solutions to impact-focused startups.
The partnership aims to make collateral-free debt accessible to social enterprises at industry standard interest rates and help them maintain a good credit history, according to a statement.
Caspian Debt will work closely with Villgro over the year to identify early-stage startups in impact sectors like healthcare, clean energy, food and agri and education, and provide them with small-ticket quick loans ranging from Rs 10 to 25 lakh. The partnership aims to create a guarantee-backed product to help de-risk these collateral-free loans.
“Through this partnership with Villgro, we will provide the first set of debts by the end of Q3 2021. We hope to help start-ups from high impact sectors to gain independent access to debt, progressively improve their debt limits, and in the long-term benefit from decreased interest rates,” said S Viswanatha Prasad, managing director, Caspian Debt.
Villgro’s portfolio company Bharat Rohan, a Lucknow-based agri-tech startup, received a loan of Rs 25 lakhs.
Bharat Rohan, the first recipient of a loan under the partnership, uses unique UAV/drone based hyperspectral remote sensing and artificial intelligence to make precision agriculture, integrated pest management and contract farming real and viable.
Caspian Debt offers custom debt to first-generation social entrepreneurs, helping them with their working capital requirements. It provides a range of debt products which includes term loans, revolving facilities, invoice/order financing, quasi-equity and venture debt to high impact sectors such as agri-business, clean tech, education and employability, healthcare. Caspian says it has disbursed debt over Rs 2000 Cr to more than 140 companies over the last 7 years.
In May last year, the debt provider raised $20 million as long-term debt from the US International Development Finance Corporation (USIDFC), an arm of the US government that provides finance to impact-oriented projects.
Villgro is a technology business incubator (TBI). It supports social enterprises in the fields of agriculture, healthcare, clean energy, and climate action which have the potential to create social impact at scale. The company claims to have supported 320 social innovators since its inception in 2001.