MSME-focused NBFC lender UGRO Capital on Wednesday announced a $40 million loan commitment from the US government’s Development Finance Corporation (DFC) to provide credit to Indian MSMEs, particularly women-owned enterprises. The company said it has signed a commitment letter with the DFC — a development finance institution — which partners with private enterprises to finance solutions to the most different challenges in developing countries.
The latest financing facility from DFC is the third deal for UGRO within a year. The company has already raised approx. $30 million (around Rs 250 crore) each through non-convertible debentures (NCDs) from the Asian Development Bank (ADB) in January 2024 and FMO, the Dutch entrepreneurial development bank in December 2023.
Speaking on the new loan facility, Justin Andrews, DFC’s Acting Vice President of Small Business & Financial Services, said the access to finance for new-to-credit borrowers and MSME finance is a key driver for financial inclusion.
“This partnership will play a crucial role in advancing the growth of MSMEs and promoting gender equality through 2X qualifying businesses,” he said.
U GRO has AUM (assets under management) of over Rs 10,200 crore with a net profit of Rs 30.4 crore recorded in the first quarter of the current fiscal.
The company said it recorded the highest-ever quarterly net loan originations of Rs 1,970 crore during Q2, growing by 72 per cent from Rs 1,146 crore in Q1 FY25. Lending to micro enterprises also surged to Rs 450 crore in Q2 in comparison to Rs 209 crore in the previous quarter.
In April last year, U GRO had launched a new app GRO X to provide loans on UPI from Rs 25,000 to Rs 2 lakh.