BII leads $25m round for India's Kinara Capital
British International Investment (BII), a UK development finance institution, has led a USD 25m equity funding round for Kinara Capital, an Indian non-banking financial company (NBFC) that lends to micro, small, and medium-sized enterprises (MSMEs).
Existing investors Nuveen, the impact unit of Teachers Insurance & Annuity Association of America (TIAA), and ASN Microkredietfonds, a Dutch microfinance fund advised by impact-focused manager Triple Jump, also took part in the round. Nuveen led a USD 50m investment in April that also featured ASN Microkredietfonds.
Kinara has now raised more than USD 100m since its inception. Earlier backers include Gaja Capital, Gawa Capital, the Michael and Susan Dell Foundation, US-based VC firm Patamar Capital (formerly Unitus Impact Fund), and Sorenson Impact Foundation.
The company, which has female founders and a women-led management team, emerged in 2011 and has since disbursed INR 35bn across more than 75,000 collateral-free business loans. It is headquartered in Bangalore and has 125 branches in over 100 cities nationwide, with 1,600 staff.
The goal is to democratise access to formal financial inclusion through the myKirana app, which can move from loan decision to disbursement within 24 hours. Around 300 MSME sub-sectors in manufacturing, trading, and services can qualify for loans of USD 1,000 to USD 30,000.
Kinara wants to grow its assets under management fivefold by 2025 to USD 75m. It is targeting 200,000 MSMEs, with a view to supporting over 1m jobs and generating USD 37m in incremental income for small business entrepreneurs.
“BII seeks to invest in companies that demonstrate strong development impact capacity and offer tech-enabled innovative solutions with high potential for scalability,” said Manav Bansal, a managing director and head of India at BII, in a statement.
“Kinara Capital meets these criteria, and we are especially excited by its commitment to helping to expand financial inclusion to MSMEs, including increasing women’s access to finance which in turn promotes women’s entrepreneurship.”
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