Multi-country microfinance operator CreditAccess Asia, based in Netherlands, has raised $30 million from Hong Kong-based private equity firm Olympus Capital Asia, heralding the first fundraising in 2016.
The money raised will be used for Asia-based operations and their expansion in line with its future plan to enter two more countries, apart from India and southeast Asia, where it is operational through several local microfinance institutions. In India CreditAccess has stake in Bangalore-based Grameen Koota.
Founded in 2007, CreditAccess Asia operates a portfolio of €240 million ($258 million) serving over 1.3 million clients. In Southeast Asia, it operates in the Philippines and Indonesia. The company plans to enter Sri Lanka and Indonesia soon. It has plans to more than double its client base to over three million customers in two years time.
The deal marks the entry of Olympus Capital Asia into microfinance field and it will have a seat in the Board of Directors of Credit Access Asia. Until now, it had invested in hospital chain Aster DM Healthcare, BPO firm Quattro and water projects focused firm Vishwa Infrastructure.
Paolo Brichetti, CEO of CreditAccess Asia said: “Olympus Capital Asia supports our growth strategy to become the leading provider of financial and non-financial products for microenterprises in India and South East Asia. Given their deep experience in financial services and presence in our key markets of India and South East Asia, Olympus Capital Asia is an ideal partner to help accelerate our growth plans driven by tapping new geographical markets in Asia and via the expansion of our product range to meet our clients’ needs.”
Daniel Mintz, Managing Director of Olympus Capital Asia, echoed similar views. “We are very excited to be partnering with CreditAccess Asia, which is very well positioned for the growth opportunities within the unbanked sector by offering fair and stable access to credit and other financial services.”
Over half of the world’s unbanked population resides in Asia (Worldbank 2015) and India and South East Asia with a population of two billion people but a low financial penetration of the banking system, provide huge opportunity for micerofinance potential for over 200 million households who are credit worthy and demand customized financial services supporting their businesses, said a statement.
CreditAccess Asia primarily operates in India through the Grameen Koota, which was set up in 1999 and registered with the Reserve Bank of India. It provides timely and affordable credit for India’s poor and low-income households. The financial products include microcredit, education loans and healthcare loans, loans for house construction and home improvement.
The credit process of Grameen Koota is based on the Grameen Group Lending Model, which has been somewhat modified, to fit the Indian context. In addition, the company provides life and health insurance products.