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Micro-financing Firm Satya MicroCapital raises ₹40 crore via NCDs

Satya MicroCapital

19 September 2018, India:

Micro-financing Firm Satya MicroCapital has issued Non-Convertible Debentures (NCDs) worth ₹40 crore from a responsAbility-managed private debt fund focussing on micro and SME finance, and Microfinance Enhancement Facility S.A. (MEF). The company will use the fresh capital for on-lending to Indian micro, small and medium enterprises.

Mr. Vivek Tiwari, MD and CEO, Satya MicroCapital Limited said, “Having achieved tremendous growth since the previous financial year as well as having built a presence across 11 states in the country, we are at a critical juncture in our growth trajectory. The funds raised will help us scale up our operational base, capital base and reach more entrepreneurs by developing innovative credit offerings for micro, small, and medium enterprises across the country.”

Satya MicroCapital Limited is an NBFC-MFI that offers collateral-free credit to micro enterprises on the basis of strong credit assessment and a centralised approval system. The company has adopted a unique Limited Liability Group (LLG) Model for extending loans and ensuring repayment. The company’s LLG model distributes the liability among each group member which exists only up to 10 instalments in bi-weekly collections.

Through the model, the company aims to add a social touch to lending by integrating modern technology into the Micro Finance industry. Satya MicroCapital Limited primarily caters to women who own businesses or are looking for business expansion. The group lending model allows groups of borrowers to share the liability and responsibility to repay loans, while helping them build a strong credit profile in order to avail finance from traditional financial institutions.

Satya MicroCapital started operations in January 2017. It provides loans to small entrepreneurs in both rural and urban areas. Its Limited Liability Group (LLG) model, mainly focuses on women, with their husbands acting as co-borrowers, through a credit product that allows them to start a new business or build their existing business. It has 57 branches in 57 districts in 11 states – Assam, Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Odisha, Punjab, Rajasthan, Uttar Pradesh, Uttarakhand and West Bengal.

(Source and Image – Satya MicroCapital)

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