Swarna Pragati Housing Microfinance raises INR 210 mn from Aavishkaar Goodwell and existing Inves

MUMBAI, India - Oct. 3, 2013 - PRLog -- New Delhi-based Swarna Pragati Housing Microfinance today announced the successful closure of its equity financing, for a primary infusion of INR 210 million led by Aavishkaar Goodwell, the country’s pioneering financial inclusion fund. Existing investor- Asia Pragati, a NBFC backed by PAG(Pacific Alliance Group), the region’s largest Asia focussed investments group, has also participated in this round.

Having succeeded in piloting its innovative and unique housing microfinance model, Swarna is poised for its next stage of growth and will use the capital infusion to strengthen its presence in Maharashtra, Orissa, Karnataka and Tamil Nadu, as well as to expand into other states.

Set up and promoted by a dynamic team of senior bankers led by Mr A. Ramesh Kumar, former CGM, State Bank of India and Chairman of NABARD’s National Committee on Rural Habitat with rich operational experience in the financial sector, Swarna Pragati Housing Microfinance has a portfolio of Rs 18.5 crore. Since it became operational in 2011, the company has built a customer base of over 3,000 borrowers, and targets to cater to one lac households by 2018. The company has innovated housing finance   and mortgage systems to overcome the hindrances that impede the flow of credit to the Rural segment. It leverages the grassroots community institutions to evolve simple, flexible cost effective and fault proof mechanisms for administration of housing finance to this segment. The company’s revolutionary model in the housing sector and has made housing finance accessible for the marginalised sections with special focus on rural dwellings. The housing loans are provided both for fresh construction and for renovation/repairs/up-gradation of existing houses. Under the unique Swarna Pragati model low-income families build their houses one step at a time in a process known as incremental housing or progressive build. They add water and sanitation facilities to a basic house, improve flooring, roofing and gradually add new rooms. This incremental build concept is in the design of housing microfinance products by Swarna Pragati.In addition; the Company has introduced the concept of paralegal documentation to provide access to housing finance to families without a fool proof document of title to their property.

Speaking on the investment, Vineet Rai of Aavishkaar Goodwell said, “We are proud to support Swarna Pragati in scaling this pioneering housing finance model. We are excited about our partnership with Swarna Pragati on account of its excellent management team with a strong social consciousness, focus towards under-served areas and their unique partnership model.”

A RameshKumar, Chariman & Managing Director, Swarna Pragati Housing Microfinance Pvt. Ltd said "Swarna Pragati strives to be the premier provider of innovative housing finance products, delivered through a unique model, to achieve the goal of giving access to a dignified and functional house for the under served Rural families. Aavishkaar has been one of the foremost institutions to show interest and confidence in our innovative affordable housing finance model. We find Aavishkaar to be one of the best investors to support companies dedicated towards creating social impact in rural India. I am confident that with their active support we will create a Rural Housing Finance revolution."

About Swarna Pragati

Swarna Pragati’s housing microfinance model is a non-subsidized, sustainable approach tailored to the needs of the low-income market. It applies the best practices developed over the years for microenterprise finance to the housing needs of rural and semi-urban borrowers. It offers an alternative to the limitation of formal housing finance products in the market by providing short term cash-flow-based credit for renovation and incremental Housing construction purposes. The company is targeting LIG and EWS borrowers across different states in India.

Asia Pragati Capfin Pvt. Ltd. an NBFC headquartered in New Delhi and owned by Hong Kong based Pacific Alliance Group holds the majority shareholding in Swarna Pragati.

About Avishkaar Goodwell:

Aavishkaar is one of the most active venture capital funds investing in high potential financial inclusion and broader inclusion enterprises (Renewable Energy, Education, Healthcare, Water & Sanitation, Livelihoods etc), serving the bottom of pyramid (BOP) segment.  Aavishkaar has under management currently, four funds with a corpus of over $157mn. Aavishkaar aims at impact investing; to promote inclusive growth by supporting the development of social enterprises to deliver basic services to serve the BOP segment in a scalable, affordable and commercially viable manner. Aavishkaar seeks to partner with visionary entrepreneurs to help take these social enterprises to new levels of sustainability, scalability and professionalism.

About Asia Pragati

Asia Pragati Capfin Private Limited is a rapidly growing Non Banking Financial Company (NBFC) in India seeking to be the preferred provider of innovative financial solutions and making a positive difference to individuals, society & environment. It aim to accomplish its mission by assisting clients in achieving their objectives through innovative products and services and handholding them as partners on the path of progress.