Ujjivan Financial Services raises CP through domestic MF

MUMBAI: Ujjivan Financial Services, has raised Rs 50 crores from a domestic mutual fund through placement of commercial paper.

This is the first CP issuance by Bangalore based microfinance institution. The 3-month tenor issuance was rated A1 by CRISIL. IFMR Capital was the sole arranger to the issue.

"This transaction is a big milestone for both the sector and for Ujjivan as one of the largest MFIs in the sector as it represents remarkable investor confidence in the sector," said Samit Ghosh, Founder and Managing Director, Ujjivan Financial Services Private Limited.

This issuance signifies the opening up of yet another avenue of funding to the sector, said company CFO Sudha Suresh. Increased diversification in funders as well as instruments of fund-raising will further improve efficiencies for Ujjivan which will translate into lowering of cost of lending to our borrowers.

Started in 2005, the company serves over 2.5 million customers across 24 states in India through a network of over 450 branches and over 7500 employees. It has disbursed loans of over Rs.12338 Crores with a repayment rate above 99 per cent.