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    HomeNewsBusinessCompaniesMFI Bandhan Financial may raise $35 mn from IFC

    MFI Bandhan Financial may raise $35 mn from IFC

    Microfinance firm Bandhan Financial Services Pvt. may raise an equity round of up to USD 35 mn from International Financial Corporation (IFC), the private investment arm of World Bank.

    January 14, 2011 / 19:19 IST

    Microfinance firm Bandhan Financial Services Pvt. may raise an equity round of up to USD 35 mn from International Financial Corporation (IFC), the private investment arm of World Bank. The deal could be the largest equity fundraise by a microfinance institution after the AP ordinance crisis hit the industry. Kolkata-based Bandhan was founded by Chandrasekhar Ghosh in 2001 and is the fourth largest MFI in India.


    Bandhan Financial Services is the fastest growing MFIs in India whose base of operations is out of Andhra Pradesh. Other major MFIs include SKS, Spandana Spoorthy, Bhartiya Samruddhi Finance, Share Microfin who are all based out of Andhra and have been impacted by the crackdown by the government. Also, it has till date only raised one round of equity funding when it got $10.7 million (Rs 50 crore) investment from Small Industries Development Bank of India (SIDBI).


    Bandhan Financial Services operates in 18 Indian states focused on the northern and eastern parts of the country, including ones where population density is high and microfinance penetration is low. Bandhan has around 3 million borrowers and a loan portfolio of about $520 million.


    The funding will help Bandhan expand its existing operations as well as expand its operations in other states. It will also expand its product portfolio and establish international best practice in its
    operations and governance. Current shareholders include SIDBI which has a 10.81% stake and three public charitable trusts, who together hold an about 87% stake.

    Bandhan operates through 1,553 branches in urban and rural areas and has 9,094 employees. West Bengal accounted for 70% of Bandhan
    first published: Jan 14, 2011 05:00 pm

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