Chennai-based asset management company IFMR Investments, a wholly owned subsidiary of IFMR Capital, has announced the launch of a debt fund of Rs 250 crore dedicated to provide working capital for financial inclusion enterprises in India.
The fund is registered with Sebi as a Category II alternative investment fund (AIF). Current investors in the fund include leading insurance companies and IFMR Capital.
The fund will offer debt support to organisations that are active in sectors such as affordable housing finance, small business loan finance, vehicle finance, agri-business finance and microfinance.
The first such fund launched by IFMR Investments in 2014 was awarded the ‘Most Innovative Fund in India’ by Asia Asset Management.
The second fund has a similar structure as the first fund, which includes a first loss support, fund rating, low fixed management fee with no profit share and a daily NAV calculation.
Through its innovative fund structuring, IFMR Investments seeks to promote alternative debt investments by providing an investment experience similar to that of investing in a credit mutual fund.
The fund manager is expected to draw strong support from IFMR Capital for their experience in the targeted financial inclusion sectors spanning investment banking, investing, structuring and risk management.
IFMR Capital has already developed stringent underwriting guidelines and built significant capital market and credit history for its target sectors.
Kshama Fernandes, chairperson of IFMR Investments and MD of IFMR Capital, said, “The asset management arm of IFMR Capital housed in our subsidiary IFMR Investments is an important and valued addition in our endeavour to connect high quality originators to mainstream investors. While the first fund was exclusively focused on microfinance, its success prompted us to extend the fund management platform across all the asset classes that IFMR Capital currently works in.”