TPG leads $161m round for India's Janalakshmi

Existing investors including Morgan Stanley Private Equity Asia and Treeline also participated in the round, along with newcomers Bajaj Allianz Life Insurance and Bajaj Allianz General Insurance. The investment is aimed at helping the company complete its transition to a small finance bank (SFB), according to a release.

Janalakshmi’s main business is providing small batch loans to joint lending groups. It also lends to selected individuals with good credit history, along with micro, small and medium-sized enterprises. The company has 462 branches across India, in 17 states and two union territories.

The small finance bank license, for which Janalakshmi received in-principle approval from the Reserve Bank of India in 2015 and final approval earlier this year, is aimed at helping India’s low-income citizens enter the formal banking system. License holders can perform basic banking services such as acceptance of deposits and lending.

Janalakshmi plans for the SFB to have a national presence with 300 store fronts across India by 2018. The company will continue to service the microfinance branch’s existing customer base, but sees the SFB as a way to expand its reach and offer more services.

Janalakshmi is one of several PE-backed microfinance institutions and non-banking financial companies to receive an SFB license in recent years. Some recipients, such as Equitas Holdings, Ujjivan Financial Services and Au Financiers, have pursued public listings so as to boost their capital holdings without having to raise more equity capital from foreign investors.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• South Asia
• Financials
• Expansion
• India
• TPG Capital
• Morgan Stanley Private Equity Asia
• Financial Services