Private sector lender Yes Bank on Tuesday said it has signed loan agreements worth $265 million with OPIC and Wells Fargo to support small business growth in India.
"Yes Bank has signed an agreement with Overseas Private Investment Corporation (OPIC), the US government's Development Finance Institution, for debt financing of $245 million to increase lending to micro, small and medium enterprises (MSMEs) in India," Yes Bank said in a regulatory filing.
The loan agreement was signed in Washington DC, it added.
The domestic lender said that US-based Wells Fargo Bank will act as sponsor and co-lender to the project, providing a loan of $20 million, bringing the total facility amount to $265 million.
Specifically, half of the financing will be used to support either micro-SMEs or SMEs in under-served rural and urban markets, it said.
"MSMEs are the growth engines and employment generators of our economy, and access to banking credit is one of the key enablers.
"This significant co-financing agreement of Yes Bank with OPIC and Wells Fargo will help further accentuate Yes Bank's ability to address unique needs of SME and MSME sectors," Yes Bank MD and CEO Rana Kapoor said.
"OPIC's exciting partnership with Yes Bank, a proven Indian lending institution, and Wells Fargo will spark inclusive economic growth in India," OPIC President and CEO Elizabeth Littlefield said.
The commitments by OPIC and Wells Fargo were initiated during US President Barack Obama's visit to India in January this year.
"Wells Fargo is pleased to sponsor this important facility on behalf of Yes Bank and work with OPIC as they continue to support Yes Bank's lending to the small and micro businesses vital to economic growth in India," Head of Wells Fargo's International group, Richard Yorke said.
The World Bank has estimated that the viable and addressable demand for MSME lending in India debt surpasses supply by $48 billion, a shortfall that holds back the transformative effect a thriving entrepreneur class can have on a developing economy.
(PTI)
