SUMMARY
- UGRO Capital has entered into a commitment agreement with the DFC for a $40 million loan.
- USAID is backing this deal by contributing its personnel and integrating its technical initiatives.
- This agreement marks the third impact deal for UGRO Capital in the past year.
MSME lender UGRO Capital, has entered into a commitment agreement with the United States International Development Finance Corporation (DFC) for a $40 million loan.
The United States Agency for International Development (USAID) is backing this deal by contributing its personnel and integrating its technical initiatives to promote inclusive and sustainable economic development, the company announced.
This investment is essential in UGRO Capital’s mission to empower small businesses at the local level and enhance financial inclusion throughout the nation.
The funds will empower UGRO Capital to expand its support for small and medium-sized businesses in India, with a particular emphasis on empowering enterprises owned by women.
“Our shared vision of financial empowerment and inclusive growth drives us forward, and with DFC’s support, we will be able to further our mission of addressing every need of every MSME, especially women-owned businesses and new-to-credit borrowers,” Shachindra Nath, the Founder and Managing Director of UGRO Capital, said.
The company intends to allocate approximately 70% of the funds to qualifying businesses (women-owned or led), at least $5 million of the funds to supporting new-to-credit borrowers, with the support of the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) Guarantee, the company added.
“Access to finance for new-to-credit borrowers and MSME finance is a key driver for financial inclusion, and we are thrilled to be working with UGRO Capital to address the credit needs of small businesses aligned with our goal of supporting economic growth and financial access in underserved communities. This partnership will play a crucial role in advancing the growth of MSMEs and promoting gender equality through 2X qualifying businesses,” the company noted.
This agreement marks the third impact deal for UGRO Capital in the past year. It had previously secured around $29.7 million through Non-Convertible Debentures (NCDs) from the Asian Development Bank (ADB) in January 2024 and FMO, the Dutch entrepreneurial development bank in December 2023.
