Svatantra Microfin Private Limited, founded by Ananya Birla, is set to acquire Chaitanya India Fin Credit Private Limited, a subsidiary of Sachin Bansal’s Navi Group, in a significant deal valued at Rs 1,479 crore. The transaction is anticipated to be finalized by the end of 2023.
The acquisition positions Svatantra as the second-largest microfinance company in India, boasting a broad reach of over 3.6 million active customers through 1,517 branches across 20 states.
- The combined entity is projected to hold assets worth Rs 12,409 crore as of March 31, 2023, establishing a robust presence in the Indian microfinance sector.
Both Svatantra and Chaitanya are recognized as new-generation NBFC-MFIs, leveraging technology to drive growth and profitability while addressing the financial needs of rural India.
The acquisition aligns with Navi Group’s strategy to prioritize digital-first businesses, emphasizing its commitment to digital-first financial services.
Svatantra aims to leverage the combined expertise of both teams to further accelerate growth and prosperity, solidifying its position in the microfinance sector.
- In 2022, the Reserve Bank of India had deemed Chaitanya India Fin Credit unsuitable for an ‘on-tap’ banking license.
- JM Financial Limited played a pivotal role as the exclusive financial advisor to Navi Group throughout the transaction.
Important Questions Related to Exams
Q: What role does the proposed acquisition play in Navi Group’s strategic plan?
A: The sale of Chaitanya aligns with Navi Group’s strategic focus on digital-first businesses. The move allows Navi to concentrate on its digital-first financial services, consistent with its strategic vision for the future.
Q: How has Chaitanya India Fin Credit contributed to rural India’s financial landscape in recent years?
A: Chaitanya India Fin Credit has witnessed remarkable 6X growth over the last four years, making credit more accessible to rural India. The company’s efforts have played a significant role in addressing the financial needs of rural communities.