Chennai-based NBFC, Northern Arc Capital today announced that it has structured and arranged $20 million in external commercial borrowings (ECB) for microfinance institution, CreditAccess Grameen Ltd. It was funded by Development Bank of Austria, Oesterreichische Entwicklungsbank AG (OeEB).

The fundraise comes close on the heels of CreditAccess Grameen’s first ESG fundraise from Swedfund International AB qualifying under the 2X Challenge in 2021. As a part of the deal process, Northern Arc assisted CreditAccess Grameen in end-to-end Indian financial market scoping, credit analysis, due diligence, transaction structuring and execution.

In a press release, Bama Balakrishnan, Chief Operating Officer, Northern Arc Capital, said that the transaction comes in the backdrop of volatility in currency rates and a challenging environment for overseas issuances. 

CreditAccess Grameen said it will use this long-term funding to provide micro loans to women borrowers from low-income households for income-generating activities.

Udaya Kumar Hebbar, MD & CEO, CreditAccess Grameen, said, the fundrise from OeEB marks the third ESG-linked loan aggregating to $80 million till date. 

Shares of CreditAccess Grameen were trading at ₹937.40 apiece on NSE, marginally down from the previous day’s close of ₹941.55 per share.