MICROCAPITAL BRIEF: SEWA Subsidiary Sitara Raises $20M in Equity Funding from Nordic Microfinance Initiative, Women’s World Banking and Ongoing Shareholders to Improve Housing Conditions for Women in India
SEWA Grih Lin, an Indian affordable housing finance company also known as Sitara, recently raised USD 20 million in equity funding, including USD 8 million from the Norway-based Nordic Microfinance Initiative (NMI). Sitara procured the remainder in unspecified portions of the asset management unit of Women’s World Banking (WWB) in the United States, Housing Development Finance Corporation in India, Oikocredit in the Netherlands and Omidyar Network India of the American Omidyar Group. Of these, the last three had invested in Sitara before.
Sitara plans to use the new funding to expand its services to more customers, including in new locations. In 2022, the organization serves 15,000 customers in eight states. Its goal is to serve an additional 7,000 people by March 2023 with loans totaling INR 5.0 billion (USD 65 million), expanding its portfolio to INR 7.7 billion (USD 100 million).
Founded in 2011, Sitara is an initiative of the Independent Women’s Association of India (SEWA) which provides loans for the purchase, construction and improvement of houses mainly to women living in cities in the north and The west of the country. These improvements include facilities such as running water, sewage systems and stronger roofing. Most Sitara loans range from INR 50,000 (USD 625) to INR 1.2 million (USD 15,000) with an interest rate of 18% per annum and a maximum term of 20 years. The lender’s other services include helping clients establish formal land title and making loans using real estate as collateral for business, schooling, and personal use.
SEWA is an organization of “poor and self-employed women” whose objective is “to organize working women for full employment…by which working women obtain job security, income security, food security and social security ( at least health care, child care and housing). ).” Founded in 1972, SEWA offers a range of programs covering areas such as research, training, financial inclusion and the creation of social enterprises to stimulate employment. The organization had 1.7 million members in 2020.
NMI was founded in 2008 with the goal of creating jobs and wealth through financial inclusion. The organization operates five funds holding aggregate assets of approximately $350 million as of 2022. These include four microfinance funds and a climate fund encouraging “Indonesian smallholders”. [to] intensify work on their existing plots instead of clearing the rainforest. NMI is owned by Norfund, which is backed by the Norwegian government; the Danish Investment Fund for Developing Countries, known by its Danish acronym IFU; and eight private companies. The organization has offices in Denmark, India, Indonesia, Kenya and Norway.
WWB is a non-profit organization that works with financial service providers, individual practitioners and regulators to boost financial services for women in low- and middle-income countries. Its subsidiary WWB Asset Management holds stakes valued at $150 million. It has 12 backers and 10 ongoing participations in 2022.
By Ben Greissman, Research Associate
Sources and additional resources
Sitara Product Offerings
SEWA home page
MNI home page
Housing Development Finance Corporation Home Page
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