Microfinance Private Equity

UNITUS makes an investment in MMFL

Madura Micro Finance gets Rs 22cr from Unitus Equity Fund

Madura Micro Finance Limited (MMFL), a leading Indian Microfinance Institution (MFI), has received a funding of Rs 22 Crores from the private equity investment firm Unitus Equity Fund L.P. (UEF). UEF makes strategic investments in high growth microfinance institutions and social enterprises and is managed by Elevar Equity LLC.

MMFL has been rated as one of the world’s top microfinance institutions byForbes Magazine 2008-Top 50 Microfinance Institutions. MMFL holds the distinction of being ranked No.1 among the Top 50, for Operational Efficiency. MMFL has its head office in Chennai, TamilNadu, and is focused on bringing large infusions of productive capital to the rural poor in South India through carefully selected and trained women’s self-help groups (SHGs). MMFL offerssome of the lowest interest rates in the country.

“We are extremely excited about the support and investment from a global, strategic investor like UEF,” says MMFL Chairman, Dr. Tara Thiagarajan. “MMFL and UEF share the common vision of growth and profitability in conjunction with positive social and economic impact. I am confident that MMFL will be able to leverage and benefit from UEF’s wide experience in the sector.”

The investment will enable MMFL to increase its management bandwidth, strengthen its institutional capacity, and continue to expand its customer base. MMFL will also roll-out a suite of new, piloted products designed to support and promote entrepreneurship by creating economies of scale for raw materials and building market efficiencies through information products that link suppliers and buyers. The products will diversify MMFL’s revenue streams, build markets for additional financing, and provide key insights into the needs of rural customers. MMFL seeks to serve over one million customers by 2013.

“UEF’s capital infusion will go a long way in supporting our continued commitment to deliver efficient, high-quality services to our rural customers, enhance the depth of our product offerings and fuel our growth.” saysMr.M.Narayanan, MMFL CEO. “Now armed with clearer insights into the needs of rural borrowers and entrepreneurs, MMFL is poised to roll out new, tailored loan products to both individuals and small groups that will cater specifically to varying risk profiles and provide additional benefits such as training and asset insurance.”

Tracing its origins to the Bank of Madura in 1995 where it began as an initiative to profitably reach rural customers under the Chairmanship of the late Dr. K.M. Thiagarajan, MMFL now operates as an independent non-banking finance company that, in conjunction with its partner organization, the Microcredit Foundation of India (MFI), serves over 380,000 customers. MMFL’s unique model focuses on increasing the value and return of each customer by offering a set of synergistic products that stimulate entrepreneurship.

“MMFL’s approach to growth and enterprise value is unique. We are impressed by the company’s ability to deepen its customer relationship and the brand it has built in the market. We are delighted to partner with them and look forward their success.” says Mr. Sandeep Farias, Managing Director of Elevar.

Abhay N

Author : 

Abhay is the founder and managing editor of India Microfinance. He is passionate about microfinance, financial inclusion and social entrepreneurship in India.

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4 Comments

4 Comments

  1. Tim Girvin

    October 14, 2008 at 1:57 pm

    Congratulations – it’s great news to hear — not only from the standpoint of Unitus’ involvement, the link to MMFL, but the continuously expanding trade in micro-investments / banking and commerce support in emerging markets in the world.

    Time for change — spare change, committed change and substantive change in how we all commit to investing in the planet — and the people.

    Tim Girvin | girvin@girvin.com | Girvin | Strategic Brands — New York City + Seattle | Tokyo | http://www.girvin.com | http://www.tim.girvin.com/ | http://blog.girvin.com/ | http://tim.girvin.com/Entries/index.php

  2. diana

    October 15, 2008 at 12:18 pm

    Just to clarify (as the media article was a bit unclear), the investment made in MMFL was from Unitus Equity Fund, a for-profit equity fund that invests in microfinance and other social enterprises. UEF is a strategic affiliate of Seattle-based nonprofit Unitus, whose mission is to alleviate poverty by accelerating access to microfinance. You can learn more about Unitus and get involved at http://www.unitus.com.

    Diana Reid
    VP Global Communications, Unitus, Innovative Solutions to Global Poverty, http://www.unitus.com

  3. Abhay

    October 21, 2008 at 1:51 am

    Tim and diana thank you both for your responses.

  4. Lokesh

    October 22, 2008 at 4:54 am

    Diana,

    Thanks for clarification.

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