MICROCAPITAL BRIEF: Satin of India Borrows $10m over 8 years from WorldBusiness Capital, Facilitated by IFMR Capital
Satin Creditcare Network Limited, a microfinance institution based in Delhi, India, recently borrowed INR 628 crore (USD 10 million) from WorldBusiness Capital (WBC), a US-based lender to small and medium-sized enterprises (SMEs). IFMR Capital, an affiliate of the nonprofit Chennai-based institute for financial management and research (IFMR) that facilitates funding for organizations that serve low-income individuals in India, structured the eight-year loan as follows: 65 percent senior secured debt and 35 percent unsecured subordinated debt. Jugal Kataria, the CFO of Satin argued that one advantage of the partnership with WorldBusiness is that: “the external commercial borrowing (ECB) route offers [ … ] an opportunity to reduce [Satin’s] dependence on banks.”
The Overseas Private Investment Corporation (OPIC), a government-backed development finance institution based in Washington DC, partially guaranteed the loan.
As of 2013, Satin had 800,000 borrowers with a gross loan portfolio of INR 1,060 crore (USD 17.1 million). Satin does not accept deposits.
As of 2013, IFMR reported assets of INR 1,800 crores (USD 34 million). As of September 2013, OPIC reported total assets of USD 8.5 billion, net income of USD 162 million, total commitments of USD 3.9 billion and active projects in 102 countries.
By Simon Pfanner
About Satin Creditcare Network Limited
Established in 1990, Satin Creditcare Network Limited is a for-profit Indian microfinance institution based in Delhi that provides financial services to micro -, small and medium – sized enterprises. As of 2013, Satin had 800,000 borrowers with a gross loan portfolio of INR 1,060 crore (USD 17.1 million). Satin does not accept deposits.
WorldBusiness Capital (WBC)
WorldBusiness Capital (WBC) is a commercial finance company that offers loans to small and medium-sized enterprises (SMEs) globally. It was founded in 2003 and is headquartered in the US city of Hartford, Connecticut. WBC’s clients include companies with revenues in the range of USD 10 million to USD 150 million in sectors that include manufacturing and distribution, packaging, food processing and agribusiness, logistics and transportation, renewable resources, and financial institutions. Financial information on the firm is not available.
About IFMR Capital
IFMR Capital, a subsidiary of IFMR Trust, is an Indian non-banking financial company that aims to provide liquidity and debt capital to the microfinance industry and other sectors that offer products and services for low-income households. IFMR Trust is an affiliate of the Indian nonprofit Institute for Financial Management and Research (IFMR), a research and educational institution. As of 2013, IFMR reported assets of INR 1.8 billion (USD 34 million).
About Overseas Private Investment Corporation (OPIC)
The Overseas Private Investment Corporation (OPIC) is an agency of the US government that was established in 1971 as a development finance institution. OPIC works with private-sector firms in the US to identify opportunities in emerging markets and create an enabling environment for private enterprise in developing countries. OPIC provides financing through direct loans as well as guarantees, political risk insurance and investment funds. As of September 2013, OPIC reported total assets of USD 8.5 billion, net income of USD 162 million, total commitments of USD 3.9 billion and active projects in 102 countries.
Sources and Additional ResourcesSource: www.microcapital.org
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