Education loan firm Avanse Financial raises Rs 357 crore via securitisation transaction

Amit Gainda, CEO, Avanse Financial Services

Education loan firm Avanse Financial Services Ltd has raised Rs 357 crore via securitisation transaction from a global financial institution, the company said on January 27.

The transaction was facilitated by Northern Arc Capital, and the corpus will support the expansion of Avanse's education financing programme, the non-banking financial company (NBFC) said.

“The organisation’s deep domain expertise, healthy portfolio and robust business strategy have enabled it to receive this long-term investment. Despite all the market fluctuations amidst the ever-evolving macroeconomic scenarios, Northern Arc Capital was able to facilitate due diligence and successfully completed the transaction between both the parties,” the company announced.

Bama Balakrishnan, COO of Northern Arc Capital, said the firm is “pleased to structure, facilitate and co-invest in this notable securitization transaction. Education financing is a bourgeoning segment in India, and we foresee several innovative models emerging in this space”.

“Avanse has been an early mover, demonstrating consistent growth and making access to high-quality education a reality for thousands of students in India. At Northern Arc, we are committed to supporting businesses like Avanse that bring transformative impact and the latest transaction is a testament to that.”

Amit Gainda, chief executive of Avanse Financial Services, claimed that it is the first securitisation transaction in the education loan space, invested by a global financial institution establishing this segment as an asset class at an international level.

“It has enabled us to boost our diversified long-term stable funding strategy,” Gainda said adding that education financing is a sunshine segment and a multi-decade secular growth opportunity in India.

Avanse Financial Services has already offered loans to around 2 lakh students studying both in India and abroad. Avanse has also provided growth and working capital to about 1,000 educational institutes.

Avanse offers loans to students for both international and domestic studies, for online education, for school fee financing, for skill development courses, and lends working and growth capital to educational institutions in India.