Caspian Debt, the lending arm of India-focussed impact firm Caspian Impact Investment Adviser Pvt. Ltd, has raised $20 million (Rs 151.14 crore at current exchange rates) as long-term debt.
The debt provider has raised this capital from the US International Development Finance Corporation (USIDFC), an arm of the US government that provides finance to impact-oriented projects, Caspian said in a statement.
This fund facility will take the form of subordinated and senior debt and will help Caspian Debt in providing customised and collateral-free loans to professionally managed enterprises operating in high-impact sectors.
These sectors include energy, healthcare, critical infrastructure and technology, it added.
Caspian Debt says it has funded over 140 companies across India. It focusses primarily on first-generation social entrepreneurs, helping them with their working capital requirements.
These entrepreneurs usually find it difficult to raise money because of no collateral as well as their asset-light business models.
The Caspian arm says it will also commit a third of its investments through this facility to women-centric businesses. The move will help it fulfill its commitment to the USIDFC’s 2X Women’s Initiative, which is focussed on providing private sector investments to businesses and funds that empower women.
S Viswanatha Prasad, founder and MD at Caspian Debt, said the funding would also help small and medium companies dealing with the economic fallout of the COVID-19 pandemic.
“This follow-on loan is an expression of confidence we place in the important work that Caspian Debt does and demonstrates our long-term commitment, particularly in these uncertain times,” said Anthony Randazzo, CFA investment director on the social enterprise finance team at USIDFC.
The larger Caspian group says it has invested over Rs 2,000 crore through four funds, including equity and debt instruments. According to its website, companies in its debt portfolio include Capital Float, workforce development company EduBridge, eye-care chain Drishti and the Delhi-based Aviom India Housing Finance Pvt Ltd.