Varanasi based Utkarsh Micro Finance said it has raised Rs 395 crore from eight domestic investors to lower its foreign holding to comply with the small finance bank (SFB) guidelines.
The company raised fund from HDFC Ergo General Insurance, HDFC Standard Life Insurance, ICICI Prudential Life Insurance, RBL Bank, Shriram Life Insurance, Small Industries Development Bank of India (SIDBI) and private equity funds such as Arpwood Investments and Faering Capital, a release said.
Utkarsh is also in process of completing secondary transactions by providing complete/partial exit to few funds which have been part of company's growth journey for more than 5 years, the release said.
"The current round of investment from eight reputed institutions reflects the confidence of the investors in the company and its management and also on the small finance bank operating model," Utkarsh Micro Finance MD and CEO Govind Singh said.
"The funds will be used to expand further business, particularly in introducing new banking products. The investment will take care of capital requirements for the next 3-4 years," he added.
Utkarsh Micro Finance is the only entity to receive the Small Finance Bank licence in the Hindi heartland of UP, Bihar, Jharkhand, Madhya Pradesh and Chhattisgarh.
The company said it plans to provide financial services to over 10 million customers by 2021.
The company began its operations in September 2009 and is now ready to launch the small finance bank, it said.
The company is serving over 1.2 million clients with a portfolio of over Rs 1,750 crore.
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