Microlender Satin Creditcare raises debt capital from Development Bank of Austria
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Microfinance firm Satin Creditcare Network Ltd has raised $15 million (Rs 107.6 crore at current exchange rate) in debt from Development Bank of Austria (Oesterreichische Entwicklungsbank AG or OeEB).

Satin is getting credit at a time when others in the NBFC (non-banking financial company) sector are finding it tough to secure cash from banks or other financial institutions.

In a report in July last year, chairman and managing director HP Singh has said his company hasn’t faced any pressure since the liquidity crisis broke out in September 2018.

The investment marks OeEB’s first bet in India microfinance under the latest guidelines for external commercial borrowing (ECB) funding. The Vienna-based bank works with institutions in developing countries and emerging markets to provide financing for sustainable economic development.

In a statement, Gurugram-based Satin said that the fresh funding will help with its planned expansion and portfolio growth, as well as increase financial inclusion through its operations in 22 states where it has a presence.

“Women often have very limited access to financial services, which is why we are particularly happy that our funds will support female entrepreneurs and contribute to improving gender equality in India,” OeEB executive board member Sabine Gerber said.

Satin makes micro loans to underserved women in rural, semi-urban and urban areas besides catering to individual businesses and MSMEs.

Satin’s Singh said the funding from the Austrian bank will also help the firm strengthen its credit services to a larger section of its potential customer base across India.

Shares of Satin were trading 4.25% down at Rs 216.30 apiece at the time of writing this report.

This is the third time Satin has raised money through the ECB route. Previously in 2015, it secured funding from US-based commercial finance company World Business Capital. Then, in July last year, it raised $9.4 million (around Rs 65 crore) from Swiss impact investor responsAbility Investments AG.

In December 2018, Satin raised $30 million (around Rs 216 crore) in debt from Dutch development bank FMO by issuing non-convertible debentures to the institution.

The company, with nearly 1,300 branches, offers financial products in the non-microfinance segment through Taraashna Financial Services Ltd. It also operates a housing financing subsidiary as well as an MSME-focused venture.

According to VCCEdge, the data research arm of Mosaic Digital, Satin reported consolidated net sales of Rs 801 crore, Rs 1,031 crore and Rs 1,442.6 crore for 2016-17, 2017-18 and 2018-19. The company posted profits after tax of Rs 25 crore, Rs 75 crore and Rs 201 crore for the respective periods.

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