India’s Ugro Capital gets $30m from ADB to bolster SME business loans

Photo credit: Asian Development Bank

Ugro Capital, an India-based nonbank financial institution (NBFI) providing SME business loans, has received US$30 million through non-convertible debentures from the Asian Development Bank.

This is Ugro Capital’s second funding from a global development finance institution. It did a similar deal with FMO, a Dutch entrepreneurial development bank, in December 2023.

Among Ugro Capital’s initiatives is a scoring model called Gro Score, which uses AI and machine learning to assess customers and offer financing. The company has also introduced a “lending-as-a-service” model in India, partnering with over 10 public sector banks and large NBFIs for co-lending.

“Impact investors are critical funding partners in enabling us to bridge India’s massive credit gap in the MSME sector,” said Shachindra Nath, the firm’s founder and managing director.

Ugro Capital said that it had assets under management of about US$1 billion as of December 2023. It added that it has raised a total of US$1.1 billion in equity and debt over the last five years.

According to the firm, it has reached about 90,000 small businesses across eight sectors.

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