International Finance Corporation, an investment arm of World Bank, decides to endow $75 million as debt investment in Mahindra Mahindra Financial Services Ltd (M M).
This investment will facilitate non-banking financial firm, Mahindra Finance, to increase lending to MSMEs (Micro, Small and Medium Enterprises), apprised IFC to the Indian daily news, VC Circle.
IFC said that besides the three-year senior, secured debt investmentit will also mobilize extra funding from other investors of Mahindra Finance, as reported by the Indian daily news, VC Circle.
Besides debt investment, Mahindra Finance will individually allocate money three times of IFCs loan from other sources or its balance sheet to lend money to MSMEs.
IFC further said that a half amount of the loan will be invested in helping women-led SMEs and the remaining amount will be utilized for the growth of MSMEs in low-income states of India.
Mahindra Finance, a financial services division of Mahindra Mahindra group, is rural-based non-banking financial corporation (NBFC). The non-banking company renders tractor and vehicle loans, fixed deposits and SME loans through its 1,300 branches throughout India.
IFCs debt investment plan comes up after almost two years following the international investment body put $100 million in Mahindra Finance in the form of non-convertible debentures.