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IFC commits $25m to India's Au Financiers

  • Andrew Woodman
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International Finance Corporation (IFC) has invested $25 million more in Indian non-banking financial company (NBFC) Au Financiers through a private placement of non-convertible debentures.

The investment comes less than three months after IFC took part in a $21 million round alongside previous backers Warburg Pincus, ChrysCapital and Motilal Oswal Securities.

Foreign institutional investors such as Dutch development financial institution (DFI) FMO, GuarantCo, which is owned by FMO, Standard Bank Group, and UK-based CDC Group also provided long-term unsecured debt to the company in early 2013.

Set up in 1996, Jaipur-headquartered Au Financiers has 225 branches in north western parts of India, and expects its loan book to soon hit the $1 billion milestone.

"IFC's financing will enable us in serving financing needs of small and medium enterprises, and help expand operations in semi-urban and rural markets," said Sanjay Agarwal, managing director with Au Financiers, in a statement. "IFC's support will provide Au an additional source of debt funding and help reduce its reliance on bank borrowings."

The new funding will be used to strengthen the company's existing product lines through its network of branches across 10 states.

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