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Janalakshmi microfinance raises $26m from PE investors

  • Alvina Yuen
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Bangalore-based microfinance institution (MFI) Janalakshmi Financial Services has raised INR1.45 billion ($26.4 million) in a Series C round of funding from a group of investors.

The capital comes in two tranches. The first, led by Citi Venture Capital International (CVCI), is worth INR650 million and was completed in June 2011. The second, led by India Financial Inclusion Fund and GAWA Microfinance Fund, contributed another INR800 million, closing last month.

CVCI and hedge fund Tree Line Asia Master Fund also participated in the second tranche. Unitus Capital served as financial advisor for the transaction.

In March 2010, Janalakshmi also reportedly raised $10 million in a round led by Treeline Asia Master Fund. Other investors included Narayan Ramachandran, former country head of Morgan Stanley India, Bellwether Microfinance Fund, Lok Capital and the Michael and Susan Dell Foundation.

Janalakshmi, led by former Citigroup banker Ramesh Ramanathan, provides micro loans in urban areas. The company has a two-tier structure: an unit that runs companies on a for-profit basis, and a non-profit holding company called Janalakshmi Social Services. Capital from Janalakshmi Social Services can only be used to address social issues.

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