Ratan Tata, others invest in Grameen Capital’s social impact debt funding arm

By Ishaan Gera

  • 25 Mar 2015

Grameen Capital India, a social impact-focused investment advisory firm, has raised an undisclosed amount in funding from a group of investors, including Ratan Tata, chairman emeritus of Tata Sons, the holding firm of Tata Group, for a new debt investment vehicle.

The investors in the firm's non-banking financial company (NBFC) include Dempo Group chairman Shrinivas Dempo and investment banker Vikram Gandhi besides existing investors, Grameen Foundation and Amit Patni and Arihant Patni (sons of Patni Computer co-founder Gajendra Patni).

The company said it is in advanced discussions with two institutional investors to raise additional equity capital for the NBFC to meet its initial target of raising $10 million. It expects to start lending from the new vehicle in the next quarter.

Royston Braganza, chief executive officer of Grameen Capital India, said, “Traditional sources of debt, in many cases, are neither adequate, affordable nor timely, forcing social enterprises to end up using equity for working capital. We hope that our debt vehicle will help, in a modest manner, attract attention and debt capital to the base of the pyramid.”

The initial focus of the NBFC would be on financial inclusion, agriculture, affordable health and affordable education.

Grameen Capital India is an investment advisory services firm targeting impact-focused enterprises through debt and equity funding solutions, credit enhancement and strategic advisory services. It also advises double bottom-line funds on their impact investment programmes in India.

The firm claims it has facilitated more than $160 million of both equity and debt capital for social enterprises.

It was established in 2007 as a joint venture between Grameen Foundation, Citicorp Finance and IFMR Trust.

Ratan Tata, who retired as chairman of Tata Sons in December 2012, has been making small investments in his individual capacity. In the recent past, he has backed several online ventures, including e-commerce marketplace Snapdeal, jewellery e-tailer BlueStone, online furniture store Urban Ladder, healthcare service provider Swasth India, auto classifieds portal CarDekho and most recently backed Paytm parent One97 Communications.

(Edited by Joby Puthuparampil Johnson)

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