At a time when the microfinance sector is facing mounting liquidity pressure on account of the lockdown, Delhi-based Satya MicroCapital and Uttar Pradesh-based Sindhuja Microcredit have raised Rs 105 crore and Rs 65 crore, respectively, during the lockdown phase.
Microfinance is a kind of financial or banking service that provides services to individuals and small businesses who do not have much access to the standard banking systems. In other words it provides micro-credits or micro-loans to people who are socially or by any other means excluded by the traditional banking system. It promotes inclusion of these vulnerable groups and businesses into the banking system which will later facilitate them to get loans and other financial help and solutions when needed.
“The confidence exuded by Japan-based Gojo & Company that funded Satya MicroCapital, and Norway-based Nordic Microfinance Initiative (NMI) and Carpediem Capital that funded Sindhuja Microcredit, in the Indian microfinance sector at such times is truly encouraging for the sector,” Microfinance Institution Network (MFIN), a microlenders’ industry body, said on Monday.
Harsh Shrivastava, CEO, MFIN, said, “This clearly shows the confidence that equity investors have on the Indian microfinance sector, its capacity to bounce back and manage its portfolio qualities even during demonetization, Andhra crisis, etc, making it a safe and viable impact investment. Both investments came in the last few days, showing the resilience of the sector.”
During such a time where companies and firms and shutting down due to the aggravating impacts of the covid-19 pandemic, Satya MicroCapital Ltd was one of the first company in the mico-credit service providing sector to be funded.