Northern Arc Capital announced that it had completed a transaction with Proparco for an External Commercial Borrowing of USD 25 million.
Northern Arc will use the proceeds to support women business owners and MSMEs, especially in the next billion people. The funds obtained will be applied to giving these clients both direct and indirect differentiated credit solutions.
The project qualifies for the 2X Challenge, a worldwide gender finance effort to which Proparco has contributed since its launch in 2018 because of the major impacts it has had on women entrepreneurs. The Project also addresses 3 SDGs: SDG 8 (Decent Work and Economic Growth), SDG 5 (Gender Equality) and SDG 10 (Reduced Inequality).
For almost 21,000 microborrowers and MSMEs in India, the Proparco grant will boost access to lending. According to estimates, the project will assist in the retention of 34,000 jobs.
“We are excited to partner with Proparco to cater to the diverse financial requirements of the next billion and emerging segments. The usage of proceeds will be towards enabling the next billion customers access financial services directly through digital channels as well as serving them through partnerships,” said Ashish Mehrotra, MD & CEO of Northern Arc Capital.
Over the past three years, Northern Arc has raised money from a variety of reputable international investors, including USDFC, ADB, FMO, Calvert Impact Capital, and JICA.
“Northern Arc’s mission to enable access to finance for the underbanked in an efficient, scalable and reliable way is in line with Proparco’s Financial Inclusion strategy in India. Northern Arc’s role as a bridge between originators serving financially excluded customer segments and debt capital market with the use of technology creates multiplier impacts.” said Ms Diane Jegam, Regional Director – South Asia, Proparco.
