International Finance Corporation plans to pick up to 20 per cent stake in a new non-banking finance company (NBFC) which will primarily focus on providing financing and advisory services to Indian small and medium enterprises (SME), for around $4 million (Rs 18 crore).
The initial capitalisation of the new firm is expected to be up to $20 million and IFC’s investment will be limited to acquiring up to 20 per cent stake in it, according to IFC.
The NBFC will offer debt financing and advisory services in areas such as cleaner production, energy efficiency, renewable energy, sustainable water and sanitation & waste management, environmental clean-up, carbon finance, emissions reduction, effluent disposal, etc. It will be headquartered in Mumbai and will have operations across the country.
The key sponsor for the NBFC is Tata Capital Ltd, a subsidiary of Tata Sons Ltd and the key holding company of the Tata Group. Tata Capital caters to the diverse needs of retail, corporate and institutional customers, through its subsidiaries involved in consumer finance & advisory services, corporate finance (which includes commercial and infrastructure finance), securities business, investment banking and private equity.
IFC and other private investors propose to participate in the project through equity investment. Other private investors may include local and international institutions which will be identified shortly, the organisation has said in a disclosure.