L&T Finance gets $125 mn loan from ADB to support MSMEs, farmers

Non-banking financial company L&T Finance on Thursday said it has signed a $125 million loan pact with the Asian Development Bank (ADB) to support financing in rural and peri-urban areas in India, particularly for women borrowers.

The funding comprises a loan of up to $125 million from ADB, and an agreement to syndicate an additional $125 million co-financing from other development partners, L&T Finance said in a statement.

At least 40 per cent of the proceeds is allocated for women borrowers, while the rest will support farmers, micro, small and medium-sized enterprises (MSMEs), and loans to purchase new two-wheelers, among others, it said.

Microloans, farm equipment loans, two-wheeled vehicle loans, and MSME loans have been identified as segments with strong growth potential anticipated in the medium term, it added.

By focusing on lending in rural and peri-urban areas of lagging states in India, the project is strategically aligned with the goals of the Ministry of Rural Development, it said.