ACCION, Michael & Susan Dell Foundation and Unitus Equity Fund Invest in Swadhaar FinServe to Accelerate Microfinance in Urban India
ACCION International (through its Gateway Fund), the Michael & Susan Dell Foundation and the Unitus Equity Fund (UEF) announced investments in Swadhaar FinServe Private Limited, a microfinance institution (MFI) operating in the slums of Mumbai. The promoters of Swadhaar FinServe, Veena Mankar and Haseena Vahanvaty, bring together a unique blend of professional financial sector expertise and hands-on developmental sector experience.
Swadhaar Finserve will purchase the business of Swadhaar FinAccess, a non-profit MFI set up by the same promoter group in 2006 to pilot financial products and services for urban slums. The Unitus Equity Fund, a private equity fund managed by Elevar Equity LLC, and the Dell family foundation have both supported Swadhaar FinAccess in the past. Swadhaar FinServe will leverage the investment to substantially scale up its individual lending product, tested and suitably modified for the urban markets in India through technical assistance provided by ACCION, and aims to serve over 100,000 clients in India. Veena Mankar, who was the managing director of a leading independent company in India before she decided to pursue her interests in microfinance and community development, commented that there have been limited attempts at introducing large-scale, individual lending models in the Indian microfinance sector. She added that they are now confident of expanding their operations beyond Mumbai into other urban centres in India.
“Swadhaar has continually experimented with new technologies and products to lower transaction costs and better serve the needs of its clients,” said Maria Otero, president and CEO of ACCION. “Our 20 percent investment is a symbol of our confidence that Swadhaar will continue to serve its clients in new and beneficial ways, and is a demonstration of our commitment to rapidly expanding microfinance for the benefit of India’s urban poor.”
“We are committed to working with organizations like Swadhaar to achieve scale and sustainability and provide market-based products and services to the underserved,” says Sandeep Farias, Managing Partner of UEF.
“Swadhaar means ‘self-support’ in Hindi, and the organization’s name is reflective of what Swadhaar enables its clients to do,” said Janet Mountain, executive director of the Michael & Susan Dell Foundation. “Providing microfinance services to the urban poor is really about helping urban families in India have the economic stability to break out of the cycle of poverty and leads to better health and education for their children. We are proud to be a part of an organization that is truly transforming lives.”