SFO Credit To Financial Institutions
Ever Growing Need For credit
- SFO Lends To Financial Institutions to Boost Country Credit Mechanism. Many sectors in most of the economies are largely underbanked or unbanked due the lack of liquidity, poor credit delivery and also inadequate capital reserves. If helped with capital, there is a potential to clock 20-30% growth in credit uptake which shall largely boost the economies with multiplier effect. To address this huge credit demand which cripples countries, SFO lends to the following entities who make an important part of the country credit mechanism.
- Banks and Non Banking Financial Companies ( NBFC )
- Who can do on-lending to various sectors on an on-going basis to ensure continuation of the synergies that have been developed between by them in delivering credit to various sectors.
- Cooperatives / Micro Finance Institutions
- The same holds true for small finance banks who are on-lending to NBFC-MFIs ( Micro Finance Institutions ) who act as “Last Mile Financiers”).
- Neo Banks / Digital Platforms
- Digital delivery in credit intermediation These have emerged in the financial sector claiming offering hassle free loans to retail individuals, small traders, and other borrowers.
Collaterals
This capitalisation of banks shall be fully securitised.
- Hard Collateral - 80 % in the form of hard assets, shares and receivables.
- Soft Collateral - 20% in the form of cash collateral. In case of Nationalised banks , sovereign guarantee can take the share of soft collateral.
The Investment Process
- SFO will help the above entities to originate more demand from credit and provide access to credit for Micro, Small and Medium Enterprises(MSMEs) a& above needy segments of every country's economy.
- The alliance aims to leverage combined reach in tier II and tier III markets to ensure timely disbursal of credit.
- Every investment shall be unique from the balance sheet perspective. The investment shall be done case to case basis.
- Rest process is similar to that of SFO Credit To Companies.
To avail this credit for financial institutions, please write to us through the contact form.