Yes Bank and International Finance Corporation (IFC) on Thursday signed a memorandum of understanding to create a fund that will make investments across sectors in north-eastern states.
The MoU would entail discussions between Yes Bank and IFC, a member of the World Bank Group, for setting up a private equity fund focused on small and growth enterprises (SGE) in the region, Yes Bank said in a statement.
“We believe that there are substantial untapped opportunities existing in the North Eastern states of India that need to be honed by the private sector in order to create local livelihood opportunities resulting in greater financial inclusion in the region,” Yes Bank MD and CEO Rana Kapoor said.
The fund corpus will focus on investments spread mainly across sectors of tourism and hospitality, food and agribusiness, infrastructure, healthcare, education, livelihood creation and affordable housing.
“IFC’s work to increase access to capital for small entrepreneurs in northeast India will help support inclusive growth in a low—income area one of our top priorities,” said Jin—Yong, the EVP and CEO of IFC.
This would be the first of its kind region—focused private equity fund directing PE into low income states to meet the deficit in access to financing for enterprises in the region.
Last year, IFC had provided a $75 million loan to help Yes Bank expand its network to reach underserved people, small and medium enterprises and agricultural borrowers in the country.
Given the high growth potential of northeast India and opportunities for greater inclusion, IFC has been collaborating with institutions across sectors to foster economic and social development in the region.