Key Highlights
- CreditAccess Grameen secured a pioneering $100 million multi‑currency syndicated social loan under RBI’s automatic ECB route.
- Funds raised in JPY and USD will finance social impact projects, empowering underserved communities across India.
CreditAccess Grameen Limited announced on Tuesday that it had raised $100 million through a social loan from international banks, in a first-of-its-kind multi-currency loan in both Japanese and US dollars.
The transaction was completed through the Reserve Bank of India's (RBI) external commercial borrowing (ECB) route, which means the bank did not need to obtain central bank approval.
The funding is provided through a syndicated loan facility, which means that multiple banks have pooled their resources to cover the loan amount. The majority of these banks are from South and Far East Asia.
It was the company's second syndicated loan facility, with Standard Chartered Bank leading the first transaction to raise $200 million in 2023.
The company originally planned to raise $70 million, but due to oversubscription from seven banks, the amount was increased to $100 million.
"The social loan shall adhere to CA Grameen's Social Loan Framework, which aligns with the Social Loan Principles 2023, stipulating the use of proceeds, social development goals, and governance, according to the Loan Market Association," the business said in a press release.
Nilesh Dalvi, Chief Financial Officer at CreditAccess Grameen, stated that the borrowing cost in this transaction is highly competitive and lower than their average.
"It is deeply satisfying to close our second syndicated social loan facility, and the first in a multi-currency format, totaling $100 million.
The total borrowing cost for this transaction is highly competitive, comparable to domestic borrowing rates, and lower than our average borrowing cost," he stated.
"We are confident of building on this momentum towards our dedicated target of 25-30 per cent foreign borrowings by FY28 to achieve geographic diversification, enhanced ALM position, and robust liability profile," he said further.
Also Read: RBI: In July, Bank Borrowing in India Surpassed Rs 9 Trillion
Surya Bagchi, Global Head - Financing Solutions at Standard Chartered Bank, stated that the loan was designed to help first-time lenders to CreditAccess Grameen.
"The syndicated term loan was structured to meet their specific needs, and our well-crafted, intensive syndication process allowed us to successfully complete bookbuilding using first-time lenders to CA Grameen, demonstrating our deep understanding of the international syndication markets," he said.
