Satin Creditcare Network raises debt capital
Microfinance firm Satin Creditcare Network Ltd has raised US$15 million in debt from the Development Bank of Austria (Oesterreichische Entwicklungsbank AG or OeEB).
Satin is getting credit at a time when others in the NBFC sector are finding it tough to secure cash from banks or other financial institutions. In a report in July last year, the chairman and managing director, HP Singh, had said his company did not face any pressure since the liquidity crisis broke out in September 2018.
The investment marks OeEB’s first bet in India microfinance under the latest guidelines for external commercial borrowing (ECB) funding. The Vienna-based bank works with institutions in developing countries and emerging markets to provide financing for sustainable economic development.
In a statement, the Gurugram-based Satin said that the fresh funding will help with its planned expansion and portfolio growth and increase financial inclusion as well through its operations in 22 states, where it has a presence. Singh also said that the funding from the Austrian bank will help the firm strengthen its credit services to a larger section of its potential customer base across India.
Satin makes micro loans to underserved women in rural, semi-urban and urban areas besides catering to individual businesses and MSMEs.
This is the third time Satin has raised money through the ECB route. Previously in 2015, it secured funding from US-based commercial finance company World Business Capital. Then, in July last year, it raised US$9.4 million from Swiss impact investor responsAbility Investments AG. In December 2018, the company raised US$30 million in debt from Dutch development bank FMO by issuing non-convertible debentures to the institution.
Satin, with nearly 1,300 branches, offers financial products in the non-microfinance segment through Taraashna Financial Services Ltd. It also operates a housing financing subsidiary as well as an MSME-focused venture. It reported a consolidated net sales of Rs 801 crore, Rs 1,031 crore, and Rs 1,442.6 crore for 2016-17, 2017-18, and 2018-19. The company posted profits after tax of Rs 25 crore, Rs 75 crore, and Rs 201 crore for the respective periods.