By IANS,
Chennai : Tamil Nadu-based micro finance company Grama Vidiyal Microfinance Pvt Ltd (GVM) has got $3.7 million (Rs.147 million) funding from Unitus Equity Fund L.P. and Vinod Khosla, a venture capitalist.
Announcing this here Thursday, GVM chairman and managing director S. Devaraj said: “The funding is key to our transformation and an impetus to our plans to serve one million poor families by 2010.”
He was referring to the growth of the company which started as a charitable trust in 1986 and grew as a major non banking finance company in the state.
With the infusion of new funds, the company’s equity base has gone up to Rs.174 million ($4.35 million).
“Our business plan is to expand our branch network by 500-600 units by entering states like Andhra Pradesh, Karnataka and others,” said Arjun Muralidharn, CEO of GVM.
The company has a book size/advances of Rs.1.15 billion and the target for the current year is to increase the same to Rs.2.85 billion.
“We enjoy a repayment percentage of 99 percent. Grama Vidiyal was recently ranked fourth in the world by the 2007 Mix Global 100: Rankings of Microfinance Institutions for having the lowest transaction cost and strong credit risk management,” said D.Shirley, chief operating officer of GVM.
According to Shirley, 12 percent of the company’s advances are for business, 10 percent for seasonal loans and the balance for general loans.
“Our cost of fund is around 11 percent and the lending rate is 12 percent. We get our funds from banks,” she added.