IFC Invests $22 million in Ratnakar Bank, Expands Financing to Small Indian Businesses
New Delhi, India — IFC, a member of the World Bank Group, has made an equity investment of $22 million in Ratnakar Bank to support financial inclusion and increase financing to agri-based businesses and micro, small and medium enterprises.
The bank expects to significantly enhance its reach among small businesses and micro-borrowers. In the coming years, a majority of them will be women. A sizable proportion of these borrowers are likely to be from low income states of Rajasthan, Madhya Pradesh and Chhattisgarh.
“IFC’s support will help us adopt best practices in risk management, and develop tailored products, sales and delivery channels to strengthen our services for micro, small and medium enterprises,” said Vishwavir Ahuja, Managing Director, & CEO, Ratnakar Bank.
IFC’s engagement with Ratnakar Bank will also facilitate the development of a social and environment management system for growing the business in a sustainable manner. The development of such a system will help ensure that environmental and social risks are well managed.
“IFC’s investment will help Ratnakar Bank reach low-income segments, including women in rural areas,” said Thomas Davenport, IFC Director for South Asia. “The investment is in line with IFC’s strategy to promote financial inclusion and support under-financed agri-based and small businesses.”
The Kolhapur-based bank has strong presence in semi-urban and rural markets of Maharashtra, Karnataka and Goa. In the last three years, the bank has expanded its network. Currently, it has 125 branches and 184 automated teller machines spread across 11 states in India. The bank has tripled its balance sheet over the last few years with assets growing by 123 percent in financial year 2012 compared to 2011. As of March 31, 2013, the bank’s assets are about $ 2.4 billion.
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, mobilizing capital in international financial markets, and providing advisory services to businesses and governments. In FY12, our investments reached an all-time high of more than $20 billion, leveraging the power of the private sector to create jobs, spark innovation, and tackle the world’s most pressing development challenges. For more information, visit www.ifc.org.
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