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Electronica Finance Limited (EFL), a provider of loans to MSMEs (Micro, Small and Medium Enterprises), has agreed upon $48 million of new funding. The equity round was led by LeapFrog Investments with participation from Aavishkaar Capital. Encourage Capital, a US-based responsible asset manager, is an existing investor in EFL but did not participate in this funding round.
The additional funds would be utilised to increase MSME finance in India's manufacturing sector, which has strong growth potential. In order to promote sustainable financial inclusion, EFL provides products in semi-urban and rural India such as machine loans, working capital loans, rooftop solar loans, and microloans secured by property.
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Shilpa Pophale, Managing Director & CEO, Electronica Finance Limited, said: “With a strong track record and deep expertise in this segment, EFL remains committed to providing technology-based solutions and financial support to MSMEs that are powering India’s unprecedented economic growth. This association with two leading social impact investors can help us support small businesses to thrive and deliver resilient, low-carbon growth.”
More than 75,000 machines have been financed by EFL to date, assisting its clients in making the switch to less energy-intensive industry. Furthermore, many of these businesses have benefited from EFL's innovative work in the rooftop solar credit market, and the company's financing has already helped MSMEs save money on energy while saving over 50,000 metric tonnes of CO2 emissions over the past three years.
Stewart Langdon, Partner, LeapFrog Investments, said: “Electronica Finance Limited is transforming India’s MSME sector through its sustainable financing solutions. Their funding plays a vital role in financial inclusion and climate resilience for small business owners who have long been overlooked by banks. The benefits of these loans go beyond the small business owner, catalysing job creation and supporting households and communities. We are delighted to have secured this fundraising round for Electronica Finance Limited and look forward to supporting Shilpa and the team as they continue to scale-up their presence across the country.”
Founded in 1990, EFL is at the forefront of MSME financing in India and is scaling its offerings under Shilpa Pophale, one of the most-experienced female CEO’s within India’s burgeoning financial services sector.
Anurag Agrawal, Partner, Aavishkaar Capital said: “Electronica Finance Ltd has a proven track-record of providing innovative financing solutions for MSMEs and we are excited to be their partner as they enter their next phase of growth. Aavishkaar Capital’s India Fund VI is committed to channel capital to resilient businesses solving large problems and EFL’s diverse portfolio across MSME, climate and rural financing brings significant opportunity to bolster inclusive development. This investment will also underscore our commitment to the 2X Challenge in supporting businesses that promote gender equality and empowerment.”
About Electronica Finance Limited
Electronica Finance Limited (EFL), a member of the SRP Electronica Group, was established in 1990 and has its headquarters located in Pune. With a history spanning more than three decades, EFL has shown to be a trailblazer in the MSME finance space, specialising in machine and climate finance.
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