International Finance Corporation (IFC), a member of the World Bank Group, has anchored an investment round of $222 million (approximately ₹1,550 crore) in Cholamandalam Investment and Finance Company (CIFCL), a press statement from the investee company said.

CIFCL, the financial services arm of the Murugappa Group, said the funding will help the company expand access to finance for micro and small borrowers, especially in the rural and semi-urban parts of India.

CIFCL’s core business includes providing commercial vehicle finance and loan against properties. The company forayed into affordable housing loans for low-income customers recently, and is looking to expand further in these States and in rural and semi-urban geographies.

According to the press statement, $92 million of the total investment will come from IFC’s own account, while the remaining is syndicated from First Abu Dhabi Bank ($50 million), MUFG Bank Ltd ($50 million), National Bank of Ras Al Khaimah ($20 million), and CTBC Bank Co Ltd ($10 million).

“IFC’s strong commitment to the NBFC space and support in helping us access credit from foreign investors will reinforce the important role played by the NBFC sector in providing last-mile credit,” said Arun Alagappan, Executive Director, Cholamandalam Investment and Finance Company.

“This arrangement has helped CIFCL tap a new investor base for its borrowings at competitive rates, which will support its growth plans,” Alagappan added. CIFCL said almost half of its clients are in low-income States, and 80 per cent of them are first-time buyers or drivers-turned-owners.

The company also said the transaction is its first US dollar-syndicated deal since January 2019, when the RBI permitted NBFCs to tap into the offshore credit market.