Commonwealth Development Corporation (CDC) together with venture capital firm Lok Capital has announced fourth round investment of $21 million (about Rs 132 crore) in the Varanasi-based Utkarsh Micro Finance Private Ltd.

The latest funding will be utilised to help the company diversify its portfolio of services and products as well as grow in existing geographies while expanding in others, Lok Capital said in a statment. The existing investors IFC, NMI and Aavishkaar have also participated in the latest round of funding.

Utkarsh offers microfinance products to the underserved population in the northern and central parts of India where access to formal source of finance has been historically underpenetrated as compared the eastern and southern states. Utkarsh has tapped into this large opportunity through credit and pension products and by launching micro enterprises loans and micro pension.

Utkarsh's customer base is predominantly women focused and its joint liability group loans are specifically designed for the lower-income women. Over four lakhs financially excluded women have been impacted in the states such as UP, Bihar, Uttarakhand, Delhi, Haryana, Madhya Pradesh, Maharashtra and Himachal Pradesh, where the company operates. It currently has 213 branches with an active customer base of over 4.8 lakhs and a loan portfolio of Rs 552 crore as of November 2014.

Prior to this investment, Utkarsh has raised three rounds of funding from Aavishkaar Goodwell India Microfinance Development Co Ltd, International Finance Corporation (IFC) and Norwegian Microfinance Initiative. The funds were deployed for product diversification and to strengthen presence in Uttar Pradesh, Bihar, Uttarakhand and Madhya Pradesh.

Apart from providing a suite of financial products, Utkarsh has also established a non-for profit arm, Samutkarsh Welfare Society, to provide vocational and financial awareness training, market linkages, and build health and green energy (solar) initiatives.

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