India is home to 21% of the world’s unbanked adults. Increased formal financing for SMEs active in the financial inclusion sector is needed for India’s fundamental long-term growth. SMEs targeted by Lok III range from Non-Bank Financial Companies (financial institutions which do not have a full banking license, and cannot take deposits, but which can facilitate other financial services) to Small Finance Banks (which can also take deposits), as well as other companies in the financial inclusion sector such as speciality financing or digital finance. Support for these innovative companies targeting inclusion naturally allows greater reach to the previously underserved population.
Lok III also targets innovative companies focused on creating access to affordable and high-quality healthcare products and services. Only 20% of the Indian population is covered by a medical insurance, with the affordability of healthcare services being critical for the majority of the remaining 80%. The Fund’s financing supports access in underserved regions to high-quality affordable clinical services and healthcare-related financial services such as savings or insurance-related platforms. With its investment of USD 8m in Lok III, SIFEM supports an investment which targets the high impact sectors of financial inclusion, healthcare and agribusiness in India.