IFC to invest in Mahindra & Mahindra Financial Services

Mahindra & Mahindra Financial Services Ltd. said on Monday that it has raised US$200 million (about Rs. 1,435 crores) in an investment round, anchored by International Finance Corporation (IFC). IFC is the private-sector investment arm of the World Bank Group. IFC has invested US$75 million from its own account and is mobilising another US$125 million as parallel loans, Mahindra Finance said in a statement.

Mahindra Finance further added that it would use the capital to create a pool of financing for micro, small, and medium enterprises (MSMEs) in low-income states. It has itself committed US$225 million to this pool. The company will earmark at least US$100 million for women-owned MSMEs. This amount will be supported by blended finance from the IFC-Goldman Sachs’ Women Entrepreneurs Opportunity Facility.

The investment by IFC is a part of its efforts to back non-banking finance companies in India, especially those, which operate in low-income states or those, which cater to women and MSMEs. Mahindra Finance, which has more than 1,300 branches and assets under management of over US$10 billion, also said that it will use the fresh funding to enhance credit in rural and semi-urban regions, with customized solutions for women borrowers in low-income states.