IFMR Capital connects high quality originators impacting financially excluded households and businesses, such as, micro finance, affordable housing finance, small business finance, agricultural finance and vehicle finance, with investors in existing and emerging debt capital markets.
IFMR Capital has identified a set of formal institutions – largely NBFCs – that have been involved in providing growth capital to MSMEs in India. These NBFCs are typically companies that have wide experience in credit analysis of vintage of 5-10 years and have other asset products (such as two-wheeler loans, commercial vehicle loans etc.) that are also provided to the informal, self-employed segment (i.e., where formal income documentation such as income tax returns are not available). These NBFCs have, over the years, developed and perfected a model for lending based on enterprise income and cashflow assessment through personal discussions with the entrepreneur, backed by local knowledge and standard business templates.
In addition to NBFCs of the above type, there are also other NBFCs that have been set up recently by experienced professionals and with equity support from mainstream equity investors, that focus exclusively on SME lending, focusing on specific sectors such as education, textiles etc. IFMR Capital is also working with such institutions to understand and evaluate their origination model.
Apart from directly making debt investments in select SME lending institutions, IFMR Capital also works to connect high quality SME loan Originators to capital market investors. Just as in the micro finance space, the core of IFMR Capital’s work in this sector is its underwriting guidelines for SME loan origination and the structuring expertise, that helps IFMR Capital in co-investing with the capital market investors in all transactions.
Over the last three-four years, several specialised categories of housing finance companies focusing on the affordable housing finance sector have been set up – most often with equity support from private equity firms and social investors. Similar to the small business lenders, these housing finance companies have also developed origination and credit underwriting models that are based on cashflow assessment through personal discussions with the customer. The housing finance companies have also developed expertise in evaluating the value of the title documents of affordable housing properties and projects.
Commercial vehicles, or vehicles used by businesses either to transport goods or to transport passengers, are mostly acquired by owners/users through external financing. Vehicle finance companies have developed valuation grids that document estimated price of each of the identified specific commercial vehicle models. Further, they have also developed expertise in evaluating the cashflows of borrowers in the income segment to assess their repayment capabilities.
IFMR Capital aims to enable access to finance for various players of the Indian agricultural value chain who require financing for activities such as input supply, production, distribution, wholesale, processing and marketing. IFMR Capital offers innovative and customised financing solutions to its partners in this space. It believes that an efficient financial solution will ensure that the benefits of financing trickle down to the last mile farmer.
IFMR Capital connects high quality microfinance institutions with debt capital markets by:
- Catalysing debt capital markets for securitisation transactions
- Using financial structuring expertise for strong risk management
- Designing innovative, client-driven products
Working closely with each of our clients, we aim to deliver the most optimal debt solution at each stage of their growth. We act not only as a structurer and arranger for our clients, but also as an investor and liquidity provider, thereby linking our own success to that of our clients.
IFMR Capital aims to enable access to finance for various players of the Indian agricultural value chain who require financing for such as input supply, production, distribution, wholesale, processing and marketing IFMR Capital offers innovative and customised financing solutions to its partners in this space. It believes that an efficient financial solution will ensure that the benefits of financing trickle down to the last mile farmer.