December 12, 2023
Axis Bank, one of the leading private sector banks in India, in partnership with GuarantCo, a part of the Private Infrastructure Development Group (PIDG), has extended INR 2.5 billion (c. USD 30 million) three-year loan to Vivriti Capital, an India-based, impact focused non-bank financial institution, to support the company’s strategy to expand its portfolio by lending to companies operating in the e-mobility ecosystem in India. GuarantCo has provided a 50 percent on-demand credit guarantee to Axis Bank for this transaction.
This guarantee is provided under the USD 200 million (INR equivalent) framework guarantee agreement which is signed by Axis Bank and GuarantCo to allow mobilisation of funds between USD 300 and 400 million (INR equivalent) to finance the e-mobility ecosystem in India. Axis Bank has closed this transaction under the framework agreement with GuarantCo which was announced under a Memorandum of Understanding during COP26 in Glasgow in November 2021.
The financing solution provided by Axis Bank and GuarantCo to Vivriti Capital, is estimated to increase the number of electric vehicles and charging stations deployed which will reduce CO2 emissions and contribute towards progressing the Sustainable Development Goals in India. In addition, up to 665 jobs are estimated to be created through this transaction, 30 percent of which will be held by women.
The transaction makes a direct contribution to SDG 9.4 (upgrade infrastructure and retrofit industries to make them sustainable with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes), SDG 11.2 (provide access to safe, affordable, accessible and sustainable transport systems for all) and SDG 5 (gender empowerment).
Speaking on the occasion, Rajiv Anand, Deputy Managing Director, Axis Bank said, "Axis Bank is committed to driving sustainable transformation within India's e-mobility sector. Our partnership with GuarantCo empowers us to extend crucial financial support to Vivriti Capital, thereby aligning with our commitment to drive positive environmental outcomes while empowering communities. Through this blended finance structure, we aim not just to fuel innovation in the e-mobility ecosystem but also to significantly impact climate change by reducing carbon emissions in our country. On the occasion of COP28, we are excited to explore the transformative potential of this framework, underscoring our dedication to advancing a greener, more sustainable future for all."
Vineet Sukumar, Founder and Managing Director, Vivriti Capital Ltd, said, “We are proud of this collaboration with Axis Bank and GuarantCo as we will actively contribute to fostering economic growth and sustainability. This will fuel our efforts to expand our green portfolio in India's e-mobility landscape as the government pursues the target of EV30@2030. Vivriti Group’s mission is to enable necessary debt finance to India’s mid-market ecosystem. We are not just building a business; we are building a world where financial success aligns seamlessly with environmental and social responsibility.”
Layth Al-Falaki, CEO at GuarantCo, said: “We are delighted to have closed our first transaction under the framework agreement that we signed with Axis Bank in May 2022. The deal with Vivriti Capital will be the first of many under this framework, and we expect it to have a transformational impact on the market and lead to increased lending for the e-mobility ecosystem in India. We will continue to utilise the climate mitigation guarantee agreed with Axis Bank to increase our climate adaptation and mitigation initiatives in line with the PIDG 2030 strategy. The guarantee framework is our largest transaction since our inception in 2005 and we are confident that it will make a significant contribution in accelerating Electric Vehicle usage in India and as a result significantly reduce carbon emissions to help address climate change in the country.”
