Centrum Capital to acquire FirstRand Bank’s microfinance business in India
Centrum Microcredit Pvt. Ltd, a subsidiary of Centrum Capital Ltd, on Wednesday said it has received a license from the Reserve Bank of India (RBI) to start microfinance business.
As part of starting up, Centrum Capital has executed a definitive agreement to acquire the Indian microfinance business of South Africa-based FirstRand Bank, which currently has around 70,000 customers in the Maharashtra region and employs over 300 people. This is the second lending business the firm has recently entered, following its entry into affordable housing finance at the end of last year.
“We seeded this business through an acquisition because to build a team for microfinance, it takes a few years and it’s not like a bigger business where you can hire from existing players and bring people in. This acquisition is largely made to bring in the team and now, we will leverage on the team,” said Jaspal Bindra, executive chairman of Centrum Group. Centrum plans to grow the microfinance business and expand to other states by infusing additional capital and also by acquiring loan portfolios of other micro lenders.
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