Chennai-based microfinance company SMILE Microfinance Ltd (SMILE) has raised around $10 million (around Rs 50 crore) from equity funds managed by Developing World Markets (DWM), a US-based social investment fund manager. Grameen Capital India was the sole equity advisor to the transaction for SMILE.
Based in Chennai, SMILE Microfinance Ltd is one of the oldest microfinance institutions working in Tamil Nadu. Since inception, it has cumulatively disbursed over Rs 700 crore and presently reaches out to nearly 300,000 poor households, said Sethuraman, chairman, SMILE.
The microfinance company caters only to women across Tamil Nadu through its 6,000 centres, and has a recovery rate of around 99.98 per cent.
He added, this is the first round of external equity financing that SMILE has undertaken. The proposed equity would help the company reach its target of Rs 1,500 crore and 1 million members over the next three years, he added.
Presently, SMILE has a total equity of around Rs 60 crore, including promoters’ Rs 10 crore. This would allow us to mobilise Rs 700-800 crore fund.
Meanwhile, Sethuraman urged the government to pass the Microfinance Bill. “This will not only allow us to regularise the industry, but will also help companies like us access foreign funds at a low interest.”
