Ananya Birla's Svatantra Microfin to acquire Chaitanya finance

Ananya Birla, the founder and CEO of Svatantra Microfin, would pay Rs 1,479 crore to acquire Chaitanya India Fin Credit. With combined assets under management (AUM) of Rs 12,409 crore after this transaction, Svatantra will rank second among India's NBFC-MFIs. In the event that regulatory permissions are granted, the acquisition is anticipated to close by the end of 2023.

Chaitanya, a division of the Sachin Bansal-controlled Navi Group that offers finance to rural India, has seen rapid expansion in recent years. The acquisition will increase Svatantra's strategic presence in South India and solidify its position in the microfinance industry. Through 1,517 offices spread throughout 20 states, Svatantra presently provides services to over 3.6 million active consumers.

Ananya Birla feels that the acquisition will catapult Svatantra into a substantial leadership position and enable the delivery of a varied range of financial services to clients across a globally diverse portfolio. The deal fits with Navi Group's strategy to concentrate on companies that are mostly conducted online.

According to the Micro Finance Institution Network (MFIN), the acquisition gives Svatantra a significant foothold in South India. Through economies of scale, the expansion will strengthen Svatantra and lead to greater efficiency.

According to MFIN, the gross loan portfolio (GLP) of NBFC-MFIs increased by 38.7% year over year to Rs 1.31 trillion at the end of March 2023, reflecting the substantial rise the microfinance sector has experienced in India. This acquisition underscores the sector's ongoing growth and consolidation.

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