Pune: DataTech non-banking financial company (NBFC) focused on MSME lending 'UGRO Capital', announced a key development in its mission to close the credit gap for small businesses in India.
The company has signed a commitment letter with the United States International Development Finance Corporation (DFC) for a USD 40 million (approx. ₹330 crore) loan. This funding aims to increase financial inclusion by empowering last-mile MSMEs (micro, small, and medium enterprises) across India.
The United States Agency for International Development (USAID) is supporting the transaction by providing resources and linking technical programs to promote inclusive and sustainable economic growth. This partnership signifies a major advancement for UGRO Capital in its journey to serve small businesses and extend financial access to underserved sectors.
This loan from DFC represents UGRO Capital’s third significant impact investment in less than a year. In January 2024, the company secured ₹2500 million through Non-Convertible Debentures (NCDs) from the Asian Development Bank (ADB) and another ₹2500 million in December 2023 from the Dutch development bank FMO.
The new funding from DFC will be targeted primarily at women-owned and led enterprises, with approximately 70% of the loan designated for 2X qualifying businesses. Additionally, at least USD 5 million will be allocated to first-time borrowers, with a CGTMSE Guarantee supporting the initiative.
Since its inception, UGRO Capital has provided credit to over 100,000 MSMEs, helping bridge the credit gap and enabling financial inclusion for smaller enterprises.
This partnership with DFC reinforces UGRO Capital’s ability to secure international investments and work alongside global institutions to expand financial access for India’s MSME sector.
Shachindra Nath, Founder and Managing Director of UGRO Capital, expressed his gratitude for the endorsement from DFC, stating, "This partnership is a testament to UGRO Capital’s capacity to create meaningful collaborations with global development finance institutions (DFIs).
Our shared vision of promoting financial empowerment, particularly for women-owned businesses, will allow us to better address the needs of MSMEs across India.”
Justin Andrews, Acting Vice President of Small Business & Financial Services at DFC, emphasized the partnership’s role in advancing financial inclusion. “MSME finance and support for new-to-credit borrowers are critical drivers of inclusive growth, and we are thrilled to collaborate with UGRO Capital to meet the credit needs of small businesses in underserved communities,” he said.
Steve Olive, USAID/India Mission Director, remarked on the joint efforts between India and the U.S. to promote sustainable growth, stating, "We are excited to work with UGRO Capital and DFC to equip India's MSMEs with the tools they need to drive inclusive economic development.”
This transaction solidifies UGRO Capital's ongoing commitment to impact financing and underscores its dedication to unlocking the full potential of India's small business sector through last-mile credit access.
