Light Microfinance, one of the fastest growing MFIs in India, has raised Rs 196 crore in Series B funding led by British International Investment (BII), the UK’s development finance institution (DFI) and Impact Investor formerly known as CDC Group. All three of the Company’s existing investors Incofin IM, Triple Jump BV and Nordic Microfinance Initiative (NMI) also participated in this round. Light founder and MD Deepak Amin states: “BII is one of the world’s leading Impact investors . Having a marquee investor like BII lead our Series B investment places Light very strongly for its continued rapid growth. I would like to thank our existing investors Incofin IM, Triple Jump BV and NMI for reposing their confidence and trust in us again. The investment is the result of Light’s commitment to robust risk management and to technology and innovation while delivering reliable finance towards inclusive growth.” The funding would be utilized for geographical expansion into new states and to diversify the company’s product lines.
Manav Bansal, Managing Director and Head of India, British International Investment, said, “I am thrilled that BII’s patient and flexible capital will back India’s microfinance sector, which we see as critical to boosting financial inclusion by increasing access to finance for women in rural areas and promoting women’s economic empowerment. Our partnership with Light Microfinance will ensure customers can access financial products that support income-generating activities and increase productivity while improving financial security and promoting sustainable economic growth within communities and across the country.”
Deepak said, “India continues to see a huge demand for financial services, especially in rural India as households try to recover from the financial difficulties faced by them due to the pandemic and at the same time get integrated into the mainstream Indian economy. India recently became the fourth largest economy in the world and is one of the fastest-growing economies in the world. Light aims to be a key pillar of this growth story for its customers by bringing timely, high-quality financial services to them.”
Light has been making significant investments in building its proprietary analytics platform which has already started yielding rich dividends for the company. The company doubled its assets under management (AUM) to over ₹ 1200 crores and 3.5 lakh customer base spread across 68 districts in 4 states. The company closed its Series B funding just over a year after its earlier funding round where it had raised ₹ 75 crores. (https://lightmicrofinance.com/blog/press-releases/)
Even during a time of extreme stress faced by the industry due to the pandemic, Light grew its AUM by over 90% over the last 12 months to ₹ 1,120 crores. The industry comprising of banks, small finance banks and NBFCs registered AUM growth of 25%. The company’s portfolio delinquency PAR>30 is 5.0% and PAR>90 is 4.0% which is one of the lowest in the industry standards. Equifax data had pegged the industry’s PAR>30 at 14.7% and PAR>90 at 11.9%. Light Microfinance has been rated BBB by CRISIL and M1 grade by SMERA Ratings.
