Dvara KGFS raises $10M in debt led by BlueOrchard

Dvara KGFS has raised $10 million in debt from the BlueOrchard Microfinance Fund, a global impact investor.

The investment was made through the issuance of listed non-convertible foreign currency bonds under the External Commercial Borrowings route. These bonds are listed on the India International Exchange in GIFT City, Gujarat. 

What does Dvara KGFS do?

Dvara Kshetriya Gramin Financials (Dvara KGFS) is a rural-focused financial services company operating as a Non-Banking Financial Company (NBFC) in remote parts of India.

The company provides a wide range of financial services, including loans and third-party products to individuals and micro-businesses.

With an omni-channel approach, Dvara KGFS aims to cater to the diverse financial needs of its clients.

It operates over 400 branches across 110 districts in 10 states, including Tamil Nadu, Uttarakhand, Uttar Pradesh, Chhattisgarh, Jharkhand, and Bihar. 

Leadership comments

"The company aims to grow by 40% in the current financial year, and exploring various avenues of raising liquidity will be critical to ensuring a well-diversified resource profile," said LVLN Murty, Managing Director & CEO of Dvara KGFS.

The investment is seen as instrumental in expanding the company's reach and empowering underserved communities by providing them with critical financial services.

The listing on the India International Exchange also enhances the company's visibility in the international debt market, allowing for sustainable access to lower-cost debt.

"Our increased partnerships with like-minded foreign funds working in the impact space will be instrumental in expanding our reach," said Murty. 

"By listing its debt on the India International Exchange, the company also gains visibility to the fast-evolving international debt market, thereby securing sustainable access to lower-cost debt and allowing us to maximize our impact on rural communities," added Shilpa Bhatter, CFO of Dvara KGFS.

Empowering underserved communities

The company will use the raised funds for expansion plans and to strengthen its efforts in empowering underserved communities across India. 

Dvara KGFS recorded a 33% growth in scale to Rs 380.5 crore in FY23 compared to Rs 285.9 crore in FY22.

The company also turned profitable with Rs 12.6 crore profits in FY23 against a loss in FY22. In February 2023, Dvara KGFS surpassed Rs 2,000 crore in Assets Under Management (AUM).