Private equity-backed debt financier Northern Arc Capital Ltd, on Thursday said that it has raised $50 million (around Rs 400 crore) through non-convertible debentures (NCDs) from Dutch entrepreneurial development bank FMO.
The fintech lender will deploy half of its proceeds to serve MSMEs (micro, small and medium enterprises) and women entrepreneurs.
The long-term nature of the facility will help Northern Arc provide customized credit solutions to these customers both directly and through partners, it said in a statement.
It further added that the fund utilization will address three critical United Nations’ sustainable development goals, SDG 8 (decent work and economic growth), SDG 5 (gender equality) and SDG 10 (reduced inequality).
Since its inception in 2009, the Northern Arc Group has enabled financing for originator partners. The company serves its customer segments through its digital Nimbus platform, which helps NBFCs (non-banking financial companies), fintechs, digital lenders and investors raise debt capital from over five hundred global and domestic investors.
Over the last three years, Northern Arc has raised funds from a slew of international investors including USDFC (United States International Development Finance Corporation), ADB (Asian Development Bank), Proparco, Calvert Impact Capital and JICA.
“Through our latest partnership with Northern Arc, we can therefore support the business development across the Indian country, in line with our updated strategy towards 2030,” said Huib-Jan de Ruijter, chief investment officer at FMO.
“Our diligence frameworks and processes, underpinned by technology and data science, are trusted by some of the world’s most seasoned investors and have been validated by a decade long track record,” said Ashish Mehrotra, managing director and chief executive of Northern Arc Capital.
Along with its asset management subsidiary which manages seven AIFs (Alternate Investment Funds), Northern Arc manages a total AUM of more than Rs 9,000 crore. To date, the company has disbursed a total of over 8 million loans to retail customers across individuals, households, and small businesses.
Northern Arc also offers fixed-income investments to its investors via its AltiFi platform. The company claims that AltiFi’s exposure is spread across 657 districts in 28 states and seven union territories in India.