Northern Arc Investments Managers (NAIM) announced that the Belgian Investment Company for Developing Countries (BIO), a member of EDFI (European Development Finance Institutions), has invested Rs 65 crore in Northern Arc Impact India Fund (NAIIF). This is the eighth Fund of the Indian-based private debt fund manager.
The investment will be used to support and address the funding gaps for impact enterprises (IE) through easy, reliable, and sustainable access to finance.
NAIIF, a SEBI-registered category II Alternative Investment Fund (AIF) has a total corpus of Rs 700 crore. It has raised this from marquee investors, including domestic and international development financial institutions, global impact firms, domestic financial institutions, banks, corporate treasuries, and domestic and global family offices.
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Key investors participating in the first close included global impact investment firm Blue Earth Capital, values-based asset management and investment advisory services firm Anthos Fund and Asset Management from the Netherlands, and US-based institutional impact investor Calvert Impact Capital.
The response to the Fund led to the exercise of the green-shoe option of an additional Rs. 350 crore.
NAIIF has already deployed 100 per cent of its commitments across 30 investments in impact-focused themes such as financial inclusion, agritech and climate tech. Through NAIIF, 3.5 million women availed funding in their bank accounts; 8.9 million residents of rural and semi-urban areas were extended funding, and 1 million borrowers were newly introduced into the financing system.
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About 5.2 million loans were extended from the NAIIF to finance farm productivity through loans for purchasing fertilizer, manure, seeds, tractor or equipment, livestock and poultry.
“BIO’s investment in the Fund combines catalytic capital and capacity building and spurs ecosystem development to bridge the financing gap for SMEs and IEs in emerging markets. Through the investment, the Fund strives to provide financing for income-generating purposes and to enrich lives through opportunities for home ownership & improvement, access to sanitation and vehicle ownership, amongst many others,” said Ravi Vukkadala, CEO of Northern Arc Investments.
Carole Maman, Chief Investment Officer at BIO, said, “India has many young people working hard to improve their lives and start businesses. Strengthening the private sector through impact investing promotes fair work practices and gender equality and combats poverty and climate change, which are the main obstacles to human progress. The NAIIF is committed to supporting businesses and entrepreneurs that share this mission, and we are very optimistic about their work in this area.”
Since its inception in 2009, the Northern Arc Group has enabled financing for Originator Partners, impacting over 60 million lives across India, of which more than 42 million were women. The debt lender has raised close to over Rs. 1 trillion in customer financing.
It has an aggregate investor commitment of over Rs 5000 crore and is a wholly owned subsidiary of Northern Arc Capital Limited, a financial inclusion-focused NBFC in India with over Rs 1 trillion in debt financing enabled since 2008. The firm is currently fundraising for its tenth Fund.
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