UGRO Capital, a leading DataTech NBFC specialising in MSME financing, announced a key milestone in its effort to close the credit gap in India’s MSME sector. The Company obtained a commitment document with the United States International Development Finance Corporation (DFC) for a USD 40 million (about INR 3300 million) loan. The United States Agency for International Development (USAID) is supporting this transaction by allocating personnel resources and linking technical initiatives to promote inclusive and sustainable economic growth. This investment is a significant step in UGRO Capital’s efforts to empower small companies at the grassroots level and increase financial inclusion throughout the country.
This financing agreement from DFC will be UGRO’s third impact deal in a year. The Company has previously raised around INR 2,500 million 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. DFC’s assistance will allow UGRO Capital to expand its lending operations to small and medium-sized businesses throughout India, with a focus on boosting women-owned firms. Approximately 70% of the money will be dedicated to 2X eligible enterprises (women-owned or led), with at least USD 5 million supporting new-to-credit borrowers under the CGTMSE Guarantee.
Over the last six years, UGRO Capital has extended credit to over 100,000 MSMEs, playing a critical role in facilitating financial access for under-represented small businesses. This relationship with DFC strengthens the Company’s potential to attract international finance and collaborate with impact-driven global financial institutions to benefit India’s large MSME sector.
Shachindra Nath, Founder and Managing Director of UGRO Capital, expressed his enthusiasm for the partnership, stating, “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.”
The DFC’s commitment reflects its emphasis on supporting small firms in emerging economies. Through this relationship, UGRO Capital will continue to use its technology-driven strategy and multi-channel distribution model to reach a wider range of MSMEs.
Justin Andrews, DFC’s Acting Vice President of Small Business & Financial Services, highlighted the alignment between the two organizations, stating, “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.”
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This deal demonstrates UGRO Capital’s dedication to furthering its impact finance aims and its ambition to unlock India’s small company potential by providing access to loans at the last mile.
