UGRO Capital, a DataTech NBFC focused on MSME lending, today announced that it has signed a commitment letter with the United States International Development Finance Corporation (DFC) for a $40 million (₹330 crore) loan.
The United States Agency for International Development (USAID) is supporting this transaction by committing its staff resources and linking its technical programs to support inclusive and sustainable economic growth.
Approximately 70% of the funding will be directed to 2X qualifying businesses (women-owned or led), and at least $5 million of the proceeds will support new-to-credit borrowers, with the backing of the CGTMSE Guarantee.
This financing facility from DFC will mark the third impact deal for UGRO within a year. The Company has already raised ~₹250 crore each through Non-Convertible Debentures (NCDs) from the prestigious Asian Development Bank (ADB) in January 2024 and FMO, the Dutch entrepreneurial development bank in December 2023.
Over the past six years, UGRO Capital has provided credit to over 100,000 MSMEs, playing a pivotal role in enabling financial access for underserved small businesses. This partnership with DFC reinforces the Company’s ability to attract international capital and align with impact-driven global financial institutions to serve India’s vast MSME sector.
Shachindra Nath, Founder and Managing Director of UGRO Capital, said, “We are honored to receive this endorsement from DFC, an esteemed organization committed to fostering financial inclusion globally. This transaction is a testament to UGRO Capital’s ability to forge meaningful partnerships with reputed global DFIs. 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.”
Justin Andrews, DFC’s Acting Vice President of Small Business & Financial Services, said, “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.”
USAID/India Mission Director Steve Olive said, “As the United States and India partner to advance and achieve shared global development goals, USAID is thrilled to partner with UGRO Capital and the U.S. Development Finance Corporation to equip and empower India’s medium, small, and micro enterprises to drive inclusive growth. By leveraging innovative financing solutions, we aim to unlock the full potential of small businesses, driving sustainable and inclusive development.”
UGRO has executed a co-lending model in India which is prevalent in the West through Co-Lending relationships with 10+ Large Public Sector Banks and large NBFCs and built a sizeable off-balance sheet asset of more than 46% of its AUM through the GRO Xstream platform.
The Company is backed by marquee institutional investors (raised ₹900+ crore of equity capital in 2018, ₹340 crore in 2023 and ₹1,265 crore in 2024) and aims to capture 1% market share over the next three years.
