The Asian Development Bank and HSBC India will jointly create a $100 million partial-guarantee program to support micro-borrowers and women-run microenterprises across India.
HSBC India will expand its lending to microfinance institutions and non-banking finance firm’s, with ADB will partially guarantee the loans. About 4
lakh borrowers can be supported through this initiative, HSBC said.
"This will expand HSBC India’s risk appetite and deployed capital, helping to improve private sector financing and expand financial inclusion in India," the bank said.
This is ADB’s first partnership with HSBC India. Under the contract, a total financial support of an equivalent of $30 million will be disbursed to three local MFIs by April 2022.
The partial-guarantee arrangement will help MFIs to access capital for on-lending activities as they expand operations after the pandemic.
“Microfinance in India has had a massive influence on people’s lives as they struggled to cope with the global epidemic and has a further critical role to play as we slowly emerge from it,” HSBC India's head for commercial banking said Rajat Verma was quoted as saying in a announcement issued by the bank.