Lok Microfinance

completed

The project involves an IFC investment of up to $2 million for shareholding of up to 19% in Lok Investments or the company, a limited liability company established under the laws of Mauritius, whose investment objective will be to provide social impact capital in the form of equity and debt to qualifying micro finance institutions (MFIs) in India. The company will be the first India-focused microfinance venture tied to an advisory service provider managed by local professionals, with a significant on-the-ground presence, capable of making long-term equity investments in, and delivering effective non-financial technical assistance to MFIs in India. The decision to establish the company in Mauritius was driven by the need to make the investment structure as cost effective as possible and also allow the project sponsors to take advantage of the tax treaty established between India and Mauritius. The proposed investment aims to increase the penetration rates of micro credit in India by enhancing the volume of loans made by financial institutions to micro borrowers. The project has three underlying objectives:- to act as a catalyst for directing private capital to MFIs in India; - to fund and provide long term management and technical support to these MFIs; and - - to act as a platform for disseminating knowledge and supporting initiatives aimed at empowering the rural poor, especially women.