MSME lender Vistaar Financial Services raises ₹1,360 crore for next phase of growth

Micro-enterprise lender Vistaar Financial Services has raised ₹1,360 crore, including ₹870 crore in primary capital. The company, announced on Monday, that the round was led by Motilal Oswal Alternates and investors such as Singapore-headquartered impact investor ABC Impact participated in the round.

The funds raised in this round are set to fund the company’s growth strategy. The company aims to build on its sustainable, technology-enabled lending model, while focusing on risk management.

“We are delighted to welcome our new financial partners who share our mission of enabling credit access to underserved micro-enterprises across semi-urban and rural India. This investment allows us to deepen our grassroot presence, drive customer-centric innovation, product diversification, and strengthen brand positioning as we continue to create greater value for all our stakeholders,” said Avijit Saha, Managing Director & CEO, Vistaar Financial Services, in a statement.

In 2023, global private equity firm Warburg Pincus with current MD & CEO Avijit Saha picked up a majority stake in the private company, leading to significant expansion across operational, financial, and digital fronts.

The company has expanded across 12 states with over 250 branches and has a total of ₹5,000 crore of assets under management, with a capital adequacy ratio exceeding 50% and delivering mid-teens return on equity in the last financial year, the company shared in its note today.

Capital market firm Avendus Capital acted as the MSME lender’s exclusive financial advisor.

“We look forward to working with Avijit and the Vistaar team to support their continued expansion and deepen their reach across a segment that plays a vital role in India’s economic engine,” said Sugandhi Matta, Chief Impact Officer, ABC Impact, in a statement.

This announcement comes just days after Motilal Oswal Alternates also announced raising $800 million, for its fifth private equity fund, from global investors including the International Finance Corporation and US-based Adams Street Partners.

“Vistaar’s leadership in MSME lending, particularly in semi-urban and rural India, aligns strongly with our investment philosophy of backing transformative, high-impact platforms enabling last-mile delivery of credit,” said Vinit Mehta, Managing Director, Motilal Oswal Alternates, in a statement.