Northern Arc Capital

The INR hundred trillion investment opportunity backed by a quarter billion people

  • Large middle class in a fast growing economy.
  • The total demand for small business finance is estimated at USD 500 Billion with 80% of the demand originating from the informal sector.
  • Less than 10% of the population have access to formal sources of credit.
  • 247 million commercial enterprises don’t have access to formal finance.

Leading the way in unlocking opportunity

Northern Arc Capital, a leading A+ rated NBFC, provides the crucial link between debt capital markets and high-quality institutions that lend to underserved households and businesses. Using its deep experience, extensive data, and well-tested proprietary risk models, Northern Arc Capital delivers superior risk-adjusted returns to a growing base of

Indian and international investors keen to tap this market opportunity. Northern Arc is a co-investor in the clients and transactions it takes to capital markets. By investing in subordinated tranches of its transactions, we provide investors with credit enhancement and always ensure incentive alignment.

Sign up and express interest to participate in transactions structured by Northern Arc.
Detailed conversations with the Northern Arc team to understand your investment mandate.
 
 
 
Diligence of a potential investee company, if required.
Northern Arc will show prospective transactions in a continuous basis.
 
 
 
Upon investment approval, Northern Arc will run the execution process from end-to-end.

A new class of debt opportunities

A very small proportion of Indian population is well served by the financial ecosystem with full access to a range of credit products. The promise of growth however lies in the urban mass, rural mass and rural emerging segments of India which are largely underbanked. The Global Findex report 2017 states that about

40 percent of Indians had accessed some form of credit during the year 2017. Of these, less than 10 percent had availed credit from formal sources of borrowing. All the remaining had availed credit semi-formally from family and friends and other sources. These underbanked segments form the core of Northern Arc core focus.

  • Microfinance
  • Agricultural Finance
  • Affordable Housing Finance
  • Vehicle Finance
  • Fintech
  • Small Business Loans
  • Gold loans
  • Consumer Finance

We work with specialized non-banks, differentiated banks and fin-tech players who cater to the unique needs of this segment. These non-bank players are expected to continue growing, driven by a deep understanding of customers, track record of product innovation, efficient delivery systems, and a differentiated value proposition.

By mining for opportunities, and applying innovative, data-backed solutions Northern Arc Capital’s social impact is substantial and growing.

By enabling partners operating in remote areas of India to increase their volumes and lower their cost of borrowing, to on-lend to low-income and financially excluded households and businesses, our activities are now benefitting over 29.5 million individuals. The company also helps its clients build better operating

and monitoring systems, as well as implement customer protection principles, thus improving the quality of products and services that end borrowers receive. Therefore, we just don’t deliver unique business opportunities, we also support them in becoming great investments.

INR 55,000 crores (USD ~ 8 billion)

Debt Capital raised since inception

Current exposures are spread across

566 plus districts

in 27 states and 7 union territories

157 partners

across 6 asset classes (microfinance, small business finance, affordable housing finance, vehicle finance, agriculture finance and corporate finance)

The Northern Arc advantage

  • Higher risk adjusted returns for investors.
  • Deep understanding of sectors, proprietary risk models built off a granular database of millions of end customers over a decade.
  • Co-investment by Northern Arc Capital to provide the necessary credit enhancement for desired rating, and maintain incentive alignment with investors.
  • Post deal risk management through frequent and calibrated client visits, data analysis and field monitoring.
  • Investment opportunities through our Fund platform - Northern Arc Investments.