Chennai-based IFMR Holdings raises $25 M funding from Accion, LeapFrog Investments, and Lok Capital
IFMR Holdings, a financial inclusion platform in India, has raised $ 25 million in equity from Accion, a financial inclusion firm; LeapFrog Investments, an investor in emerging-market financial services; and Lok Capital, an Indian impact investment firm.
The new capital will allow IFMR Holdings to accelerate its financial inclusion work across India. Of the total investment, Accion has made $12.5 million, LeapFrog Investments spent $9 million and Lok Capital invested $3.5 million.
"This comes at an important inflection point for IFMR Holdings. Against the backdrop of a very favourable policy environment for financial inclusion, we are accelerating growth across all our businesses,” says Bindu Ananth, Chairman of IFMR Trust, the promoters of IFMR Holdings. He adds that he intends being at the forefront of business models combining scale and high-quality financial services for many millions of Indians.
According to IFMR Holdings, 86 percent of Indians do not borrow from a formal source, only one out of every two Indians has a savings account, and insurance penetration is barely four percent. IFMR Holdings claims to serve millions of financially excluded households and enterprises through three businesses: IFMR Capital, IFMR Rural Finance, and IFMR Rural Channels.
IFMR Capital is a debt capital markets platform for 75 originators reaching over 15million financially excluded people. It offers micro-loans, small business finance, affordable housing and commercial vehicles finance. IFMR Rural Finance is a technology licensor that developed the Kshetriya Gramin Financial Services model for remote rural markets. IFMR Rural Channels is a credit, insurance and pensions provider to over 600,000 clients through 242 branches in rural areas.
“IFMR Holdings are tackling some of the most important issues by reaching millions of financially excluded households and enterprises, especially in extremely rural areas not served by the banking system. As a result, more people are able to create and grow businesses, insure themselves and their families, and build better lives,” says Accion CEO and President Michael Schlein. Accion is a global non-profit organization dedicated to building a financially inclusive world by giving people the financial tools they need to improve their lives.
Talking about the investment, the LeapFrog Partner and Co-head Asia, Michael Fernandes, says, “We are close to IFMR through our direct investment in IFMR Capital. This is an outstanding platform to reach emerging consumers with a wide range of empowering financial tools. And we share a vision: achieving financial inclusion for all in India.”
IFMR Holdings CEO, Sucharita Mukherjee, concludes, "Our belief is that access to finance, supported by well-functioning markets, is critically important for low-income households. This exciting partnership with like-minded investors such as Accion, LeapFrog, and Lok brings the benefit of international best practice and a wide range of global insights to this work in India.”