World Bank arm IFC to loan $35 mn to Manappuram Finance

Chennai: World Bank arm IFC announced maiden help for gold loan company Manappuram Finance, committing $35 million in a three-year loan.

The investment comes at a time when non-banking finance companies (NBFCs) are facing issues on multiple fronts, starting with liquidity pressures and also the prospect of changes in regulations.

IFC said its fund infusion is in sync with its strategic objective of “increasing the resilience of the country’s financial sector while improving financial inclusion”.

“We are making our first investment in a gold-loan finance company to create opportunities for the rural and poor households to transition from informal to formal forms of credit,” its country head, Jun Zhang, said in a statement. The money will be given as a three-year secured loan to the gold financier.

The statement explained gold loan companies like Manappuram offer loans to financially-excluded customers and small businesses by enabling them to monetise their gold without the need for documentary proof of income.

NT Bureau