Indian private credit fund manager Vivriti Asset Management, which recently secured an investment from the Development Bank of Austria for its latest fund, is doubling down on the country’s underserved MSME sector that faces a financing gap of $342 billion.
“The fund targets retail pools securitised by mid and small NBFCs … where the underlying asset class is productive, such as MSME finance, microfinance, rural two-wheeler finance, commercial vehicle finance, education finance, etc,” said Vineet Sukumar, founder & managing director at Vivriti Asset Management.
The potential in this segment is significant, indicated Sukumar, with India’s 63 million micro, small, and medium enterprises contributing nearly 30% to the country’s GDP, generating over 40% of exports, and employing more than 100 million people.
The firm is currently on the road to raise $250 million for Vivriti India Retail Assets Fund, an asset-backed securitisation vehicle, and has so far secured investor commitments totaling around $165 million.
The fund, which also has investors such as British International Investment (BII), Calvert Impact, M&G Catalyst, and International Finance Corporation (IFC), is expected to reach its final close by March next year.
“It’s a 10-year fund. We intend to invest $1 billion over this period and harness global risk appetite into Indian asset-backed securitisation for the first time,” said Sukumar.
He added that “due to reinvestments and portfolio churn, the total disbursals will exceed the actual capital raised.”
Edited excerpts of the interview:
