Chennai-based IFMR Holdings Pvt Ltd has secured Rs 12.5 crore (approximately $1.8 million) in a fresh round of funding from French development financial institution Proparco SA, according to a press statement.
It will use the fresh round of funding to strengthen and support downstream companies, fuel its expansion plans and expand financial products for people below poverty line.
IFMR Holdings is positioned as a financial inclusion platform and houses three businesses: IFMR Capital – a debt capital markets platform for 75 originators offering micro-loans, small business finance, affordable housing and commercial vehicles finance; IFMR Rural Finance – a technology licensor that developed the Kshetriya Gramin Financial Services (KGFS) model for remote rural markets; and IFMR Rural Channels – a credit, insurance and pension provider to over 600,000 clients through 242 branches in rural areas.
“With this investment, we confirm our commitment to financial inclusion in India. IFMR Holdings is the right partner to achieve this goal as it integrates three complementary entities: a ‘brick and mortar’ financial institution offering to rural clients a diversified range of financial products, a financing platform for various types of financial institutions committed to financial inclusion, and an innovative financial products design entity,” Claude Périou, CEO of Proparco, said in the investment.
Established in 1977, Proparco is a private equity arm of Agence Francaise de Development, providing growth capital to companies in emerging and developing countries.
The firm offers loans, equity, guarantees and financial engineering to financial, infrastructure and productive sectors. It also offers advisory services, which are complementary to its range of financial instruments.
Founded in 2008 and promoted by IFMR Trust, previously IFMR Holdings had raised private capital for IFMR Capital (LeapFrog Investments) and IFMR Rural Channels (Tata Capital, Proparco, IFC, Lok Capital).
In August last year, it further raised $25 million (Rs 162.5 crore) from Accion, LeapFrog and Lok Capital’s Fund II (Sarva Capital).
Downstream companies IFMR Capital and IFMR Rural Channels have helped raise a total debt of Rs 22,000 crore and established 237rural branches, respectively.
In the financial year 2015, IFMR Holdings, together with its group companies, clocked revenues of Rs 213 crore and is claimed to have impacted over 17 million financially excluded individuals across the country.