MICROCAPITAL BRIEF: Incofin Places $4.3m in Equity in Varashakti Housing Finance via India Progress Fund

Incofin, a Belgian investor in lower-income countries, has invested INR 350 million (USD 4.3 million) to take an equity stake of undisclosed size in Varashakti Housing Finance (VHF), a firm active in “India’s rural affordable housing finance market.” Incofin sourced the funds from the Incofin India Progress Fund, which the firm launched in 2021 to invest equity in agricultural value chains and financial inclusion.

VHF is a woman-led firm that was founded in 2019 and provides the following loan products to low-income women and their families: (1) Home Loans; (2) Small Ticket Home Loans; (3) Home Improvement Loans; (4) Small Ticket Business Loans and (5) Loans Against Property. Among the goals of these loans is to help families consume less energy and water. The firm has 28 branches and reports INR 1.2 billion (USD 14 million) in assets as of June 2023.

Incofin Partner and Regional Director for Asia Equity, Aditya Bhandari, noted that, “With this investment, Incofin reinforces its mission to invest with a gender lens and to support climate resilient solutions. We see a large opportunity in the rural Indian affordable housing finance industry and believe that VHF’s experienced team together with its strong technology platform will realise success while achieving deep impact goals.”

Founded in 2001, Incofin is a for-profit firm that seeks “to promote inclusive progress.” As of 2022, it had 350 investees in 65 countries, mostly active in financial inclusion and agriculture. Incofin has offices in Belgium, Cambodia, Colombia, India and Kenya. The firm’s portfolio was valued at USD 1.4 billion as of 2021 and comprises funds affiliated with organizations such as the Belgian cooperative BRS, the German firm Invest in Visions and Belgium’s vdk bank.

By Elva Montelongo, Research Associate

Sources and Additional Resources

Incofin press release
https://incofin.com/incofin-india-progress-fund-invests-in-varashakti-housing-finance/

VHF homepage
https://varashaktihousing.co.in/

Incofin homepage
https://incofin.com/

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