Northern Arc Secures $75M to Drive Financial Inclusion in India

June 25, 2024: Northern Arc Capital Limited, a leading Indian non-banking financial company (NBFC), has secured a significant investment of $75 million from FMO, the Dutch development bank. This funding, facilitated through senior secured non-convertible debentures (NCDs) listed on the BSE with a five-year tenure, will empower Northern Arc to further its mission of promoting financial inclusion and sustainable economic growth.

Furthermore, this investment will help expand access to the retail credit requirements of the under-served households and businesses in India

“This capital injection allows us to strategically channel resources towards microloans, small and medium enterprises (SMEs), and green projects,” said Ashish Mehrotra, Managing Director and CEO of Northern Arc Capital, in a statement. “By doing so, we aim to create a ripple effect that fosters financial inclusion and propels sustainable economic development across India.”

Northern Arc , a diversified financial services platform emphasizes the role of its innovative platforms, nPOS and Nimbus, in achieving its goals. nPOS is a cloud-based API-driven solution designed to streamline loan processing for partnerships and co-lending businesses. Meanwhile, Nimbus provides comprehensive debt transaction management functionalities.

“These platforms play a vital role in our mission by ensuring efficient loan processing and effective debt management,” Mehrotra added.

Northern Arc Capial FMO Strengthens Partnership for Financial Inclusion

Northern Arc
Northern Arc chalks out ambitions financial inclusion plans

Huib-Jan de Ruijter, Chief Investment Officer at FMO, commented on the partnership, stating: “We are delighted to provide long-term funding for institutions like Northern Arc that address the limited access to capital markets faced by MFIs and NBFCs in India. This local currency facility supports entrepreneurship, innovation, and the growth of SMEs and microenterprises. We are grateful for this partnership with Northern Arc, which contributes significantly to enhancing financial inclusivity across India.”

This latest funding round adds to Northern Arc’s impressive track record. In April 2024, the company secured $80 million from the International Finance Corporation (IFC), a member of the World Bank Group. Northern Arc currently manages assets worth Rs 10,081 crore and enjoys the backing of prominent equity investors like Sumitomo Mitsui Banking Corporation, LeapFrog, 360 ONE, Accion, Augusta Investments, Dvara Trust, and Eight Roads (Fidelity).

Since 2009, the NBFC has facilitated financing of over ₹1.50 trillion that has impacted over 80.59 million lives across 682 districts, 28 states & 7 union territories. We have developed domain expertise in enabling credit across our six focused sectors in India – MSME financing , Microfinance, Consumer Finance, vehicle finance (commercial vehicle, two-wheeler and EV finance), affordable housing finance and Agriculture finance.

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