Saija Equity Raise (Nov '09)
Saija Finance, a Microfinance Institution headquartered in Bihar, India’s Poorest Region, Raises Equity Capital
Saija Finance Private Ltd (Saija), a Bihar, India-based microfinance institution, is pleased to announce the successful completion of its first round of equity infusion of USD 500,000. ACCION Gateway Fund is the sole investor and Unitus Capital acted as the financial advisor.
Based in the city of Patna, state of Bihar, Saija was founded by entrepreneurs and husband and wife team S.R. Sinha and Rashmi Sinha, and currently operates two branches in the city. Saija is the only Bihar-based microfinance institution, and serves the country's poorest state. Bihar, with a per capita income of approximately $160, a 90 percent illiteracy rate, and 37 million of its 90 million people living below the poverty line, is one of the most densely populated agglomerations of poor people anywhere in the world, reports the World Bank.
Over the next five years, Saija plans outreach to households in several of the poorest states in India: Bihar, Jharkhand, Chhattisgarh, Madhya Pradesh and Uttar Pradesh. Saija aims to serve 400,000 customers by 2014 with group and individual loans, microinsurance and remittances, and will also roll out financial literacy training, as well as consumer protection assessment work through ACCION's Center for Financial Inclusion. "As we ramp up our outreach to India's poorest states, we are fortunate to have ACCION as a partner to help us grow in the right way, and we are grateful to Unitus Capital’s global and dynamic team who worked very closely with us to from start to finish make this deal happen,” said S.R. Sinha, co-founder of Saija.
The investment was made through ACCION's equity investment arm, the ACCION Gateway Fund. "Bihar faces some of the most extreme poverty in the world," said Michael Schlein, president and CEO of ACCION. "It is a very difficult environment. And yet, in a relatively short time, Saija has shown that it has what it takes to thrive and innovate in one of the world's most challenging markets. We're delighted to partner with Saija in its drive to deliver a full array of financial services to a vastly underserved population."
Eric Savage, Managing Director of Unitus Capital said, “We are proud to have facilitated this transaction between Saija Finance and ACCION. This financing is very important for the economic development of Bihar and the neighboring states, and we expect Saija Finance to play a significant role in this development.”
About Saija Finance Private Limited
Saija Finance Private Limited (Saija) is a Non Banking Finance Company formed in April 2008 with a focus on providing microfinance services for the urban and rural poor, as well as micro and small businessmen in the underserved geographies of Northern India – Bihar, Jharkhand, Delhi, Rajasthan, Chhattisgarh and parts of Uttar Pradesh and Madhya Pradesh. The geographic regions served by Saija are amongst the poorest areas of India and also are grossly underserved by formal financial institutions. As such, Saija is uniquely positioned to bring organized financial services to a large number of poor clients who otherwise would not have access to credit and other financial services on attractive terms. This also presents an appealing business opportunity.
About ACCION in India
ACCION first launched microfinance operations in India in 2005, in order to make a substantive contribution to the outreach and impact of microfinance in major urban areas. Through its subsidiary, ACCION Technical Advisors India, headquartered in Bangalore, ACCION today provides management services, technical assistance, training and investment to MFIs across the country. Current partners include Swadhaar FinServe in Mumbai; YES SAMPANN, the microfinance initiative of YES Bank, also in Mumbai; Grameen Financial Services Private Limited, in Bangalore; and now Saija Finance in Bihar. ACCION also runs an industry training center in Bangalore, and has recently expanded its successful client education program, 'Dialogue on Business,' to meet the unique needs of the sub-continent.
