Mumbai-based financial services firm Arkfin Investments has invested $ 2 million in Akme Star Housing Finance Company, in lieu of a minority stake.

Following the deal, Arkfin Managing Director Anil Sachidanand will join Akme as a mentor.

"This is Arkfin’s first investment post operationalisation. We see this investment as strategic in nature, look forward towards mentoring Akme Star HFC in its expansion journey and building business growth backed by quality,” Sachidanand told BusinessLine.

“Arkfin intends to build a strong presence in semi-urban and rural markets across India in a phased manner," he added.

Arkfin Investments provides non-banking, insurance and allied services. A BSE-listed company, Akme Star HFC has been operational in lower and middle income customer segment in Rajasthan, since 2009.

“This investment will enable the company’s transformation through the establishment of a strong risk framework, geographical expansion through physical branches, onboarding of quality manpower and deployment of technological platforms aided by mobile applications,” Ashish Jain, Managing Director at Akme Star HFC said.

Akme Star HFC is increasing its footprints across Indore, Pune, Mumbai and Chennai markets and will soon roll out its products and services targeting first-time home buyers purchasing own homes under the Pradhan Mantri Awas Yojana.

"Semi-urban and rural housing story of India is still at a nascent stage. Nuclearisation of families and rapid urbanisation continues to increase the demand for housing units in these geographies. Akme Star HFC, with its risk framework and strong vintage in these markets, is well poised to cater to similar geographies in newer states as it scales up its business,” Balraj Dubey, Director at Arkfin Investments said.