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SEWA NBFC arm witnesses delay in raising share capital

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BS Reporter Mumbai/ Ahmedabad

With investors being unsure of the MFI sector for time being, Ahmedabad-based Self Employed Women's Association (SEWA) promoted non-banking finance company (NBFC) Ananya Finance for Inclusive Growth (AFIG) has witnessed delay in its plans to raise share capital.

The NBFC was in advanced talks with the likes of IFC, Women's World Bank and Triodos Bank for raising its share capital from Rs 3 crore to Rs 200 crore last year. However, so far the talks have not materialised.

"Private equity players and other investors are unsure of investing in the microfinance institutions (MFIs) post banks refusing to lend to the sector. This has already delayed our plans to raise our share capital from Rs 3 crore to Rs 200 crore. However, we are doing our best to rope in investors for the same. Nevertheless, this may stagger our growth by a year," said Vijayalakshmi Das, chief executive officer of FWWB and managing director, AFIG.

 

The NBFC was looking at raising around Rs 200 crore through private placement. AFIG, floated by SEWA arm Friends of Women's World Banking (FWWB), was in advanced talks with some international institutional investors like IFC, Women's World Bank and Netherlands-based Triodos Bank for raising funds.

"We intend to raise funds through domestic as well as international social institutional investors. Such social equity investors will have more patience and would appreciate our work and not expect immediate and high returns. Among these, we were in advanced stages of negotiation with the likes of IFC, Women's World Bank and Triodos Bank. However, nothing has worked out so far. Meanwhile we are also scouting for domestic social institutional investors," said Das.

Although the FWWB was funding micro finance institutions (MFIs), the SEWA arm was doing so on a low key so far and hence recently set up an NBFC.

"We felt Indian poor women needed more access to finance and therefore we decided to get directly involved in micro finance by setting up an NBFC," said Das.

The NBFC, currently, supports around 140 microfinance institutions (MFI) across the country. With a share capital of Rs 200 crore, AFIG is looking at micro finance portfolio of over Rs 500 crore.

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First Published: Jun 28 2011 | 12:38 AM IST

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