India’s Svasti Microfinance secures $10m from clutch of investors

Photo: Reuters

Svasti Microfinance Pvt Ltd, a non-banking financial company-micro finance institution (NBFC-MFI), has raised $10 million from existing investors, including Adar Poonawalla, the Patni family and Nordic Microfinance Initiative, a senior executive at the firm told Mint in an interview.

The round also saw participation from other investors such as Dubai-based family office of Nalwalas, Kayenne Ventures, a Singapore-based investment vehicle led by Kajal and Navin Fabiani, and other high-net-worth individuals (HNIs) led by the Rajiv Dadlani Group.

The Mumbai-based firm was founded Arunkumar Padmanabhan and B Narayanan.

“We plan to grow our loan portfolio to ₹550 crore by the end of this fiscal year and we want to go beyond ₹1,000 crore by fiscal year 2021. We expect to open 125 branches and service five lakh customers by March 2021,” said Padmanabhan. The company also plans to diversify its geographical presence.

“We have a very high concentration in Maharashtra as 75% of our loans originate from there. But over the next year, we look to diversify our presence. Besides Maharashtra, we are also present in

Madhya Pradesh, Gujarat and Uttar Pradesh and are adding more cities and branches in these geographies,” said Padmanabhan.

By March 2021, Svasti plans to enter three more states in north and western India and aims to evenly split portfolio across existing geographies, he added.

As of fiscal 2019, the micro-lender had disbursed loans worth ₹322 crore through its 40 branches across four states. It has a total client base of 1.85 lakh of women in urban and semi-urban areas, with more than 95% of loans given under a joint-liability model, in which group members share the responsibility of repayment and default. The lender’s profit jumped 74% year-on-year to ₹3.67 crore during the period.

The company also plans to use the fresh capital to grow its medium, small and micro enterprises (MSME) loan portfolio and provide other financial services, such as consumer finance and insurance, in partnership with other leading institutions, said Padmanabhan.

In 2015, the non-bank lender raised funds from Serum Institute of India’s chief executive Adar Poonawalla, who also invested later in follow-on investment rounds in 2017 and 2018. Its early backers also include Bamboo Capital Partners, previously Bamboo Finance, venture capitalist Sajid Fazalbhoy, and other individual investors.

Till date, Svasti has raised total of ₹ 115 crore.

This article was first published on livemint.com

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.