Ananya Birla's Svatantra Microfin receives $230M investment from Advent, Multiples

Ananya Birla-led Svatantra Microfin has entered into a definitive agreement with Advent International and Multiples Private Equity for an investment of $230 million. 

Notably, the deal marks the largest investment by private equity investors in the microfinance sector in India.

Svatantra recent acquisition 

The investment comes seven months after Svatantra acquired Sachin Bansal's Chaitanya India Fin Credit Limited for Rs 1,479 crore. Upon completion of the proposed transaction and merger with Chaitanya, the combined entity will be amongst the largest non-banking microfinance companies in India, as per the company's statement.

The current promoter group led by Ananya Birla will continue to have a significant majority stake.

Providing financing solutions to women entrepreneurs 

Since starting its operations in 2013, Svatantra, which provides affordable financial and non-financial solutions to women entrepreneurs, has emerged as one of the most differentiated process and technology-driven microfinance entities in India.

Svatantra, along with its wholly owned subsidiary, Chaitanya, claims to have a team of more than 17,000 employees and serving over 4.2 million customers across 20+ states.

Ananya Birla, Chairperson, Svatantra, said, “This investment by Advent and Multiples marks a momentous occasion for us. My team and I are grateful to have investors on board who share our vision. This transformative era for Svatantra, propels us towards our goal of becoming the foremost and most impactful microfinance institution, creating a conducive environment for entrepreneurs who fuel India’s growth story.”

Investors express confidence in microfinance sector

Shweta Jalan, Managing Partner, Advent International, said, “We are thrilled to announce Advent’s investment in Svatantra. We believe the microfinance sector serves as a cornerstone for financial inclusion for women entrepreneurs in rural areas, and Svatantra is uniquely placed to create one of the largest and most resilient microfinance institutions. We look forward to supporting the team at Svatantra, led by Ms. Birla, as they embark on their next phase of sustainable growth and profitability.”

“We are delighted to back Ms. Ananya Birla in building Svatantra to be the best-in-class institution delivering inclusion at scale. Its recent acquisition of Chaitanya brings together two exceptional platforms and management teams. In line with Multiples’ ethos of powering new possibilities, we look forward to partnering the Svatantra team in its journey of expanding products, stepping-up technology and enhancing analytics to widen the reach of its transformational impact,” said Renuka Ramnath, Founder, MD and CEO, Multiples.

The transaction is subject to receipt of statutory and regulatory approvals, including the approval of the Reserve Bank of India and the Competition Commission of India, the company said.

Advent and Multiples investment in India 

Advent has been investing in India since 2007. Since inception, Advent said it has committed ~$6 billion across 18 investments, of which $1.2 billion has been committed in the financial services across 6 transactions sector including the current transaction.

Yes Bank, Aditya Birla Capital, KreditBee, ASK Investment Managers Private Limited, and CAMS are some of its notable investments. Other notable investments by Advent in India include Cohance Lifesciences (formerly RA Chem Pharma Limited), Eureka Forbes, Bharat Serums and Vaccines, DFM Foods and Manjushree Technopack.

On the other hand, Multiples has made investments in Cholamandalam Finance (CV financier), Vastu (a tech-led housing finance business), Veritas Finance (MSME financier), Kogta Financial, APAC Financial Services, Acko Tech, Niyo, IEX, RBL Bank and Sanctum (a wealth management company).