34576 - Janalakshmi NCD

Who We Are
Who We Are

IFC is the largest global development institution focused on the private sector in developing countries. By encouraging growth, IFC advances economic development, creates jobs and improves the lives of people.
More About Us
About IFC

Our Leadership

Development Partners
Accountability

Learn more about accountability
Annual Report

Download the Report
What We Do
What We Do

IFC advances economic development and improves the lives of people by encouraging the growth of the private sector in developing countries. We achieve this by investing in impactful projects, mobilizing other investors, and sharing expertise.
What We Do Overview
SOLUTIONS

Our products and services
OUR PRIORITIES

Climate Business

Fragile & Conflict Afflicted Situations

Gender

Mobilizing Private Capital

Sustainability
SECTORS & EXPERTISE

Agribusiness & Forestry

Creative Industries

Education

Financial Institutions

Funds

Health

Infrastructure

Manufacturing

Public-Private Partnerships

Tourism, Retail & Property

Trade & Supply Chain Finance

Venture Capital

Working Upstream
Where We Work
Where We Work

As the largest global development institution focused on the private sector, IFC operates in more than 100 countries around the globe. We apply lessons learned in one region to solve problems in another.
Overview
By Region

Africa

East Asia and Pacific

Europe

Latin America and the Caribbean

Middle East and Central Asia

South Asia
Our Impact
Our Impact

Our impact improves lives. IFC brings a clear set of advantages to the world’s most challenging markets. Including a history of innovation, a global mandate, and a determination to achieve measurable development impact.
Our Impact Overview
PRINCIPLES & MEASUREMENT

Impact Investing at IFC

Measuring and Monitoring (AIMM)

Evaluation

Sustainable Development Goals (SDGs)

Owned by 186 member countries and consistently rated AAA/Aaa. IFC aims to achieve our mission of promoting development by providing debt and equity to the private sector, through a range of benchmark and bespoke products.

For Partners

For Investors

Get in Touch

Summary of Investment Information

Project Number

34576

Company Name

JANA SMALL FINANCE BANK LIMITED

Date SPI Disclosed

Mar 18, 2014

Country

India

Region

South Asia

Projected Board Date

Apr 30, 2014

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Jun 12, 2021

Department

Global Industry, Financial Markets

Industry

Financial Markets

Previous Events

Approved : May 12, 2014
Signed : Jun 25, 2014
Invested : Sep 16, 2014

Sector

Microfinance and Small Business - Non Commercial Banking

Project Description

The proposed project envisages a senior debt investment in Janalakshmi Financial Services Private Limited (“Janalakshmi” or the “Company”) which is a leading urban MFI headquartered in Bangalore, Karnataka with a borrower base of more than 1 million women borrowers and a loan portfolio of approximately INR14,000 million (US$223 million equivalent).
Janalakshmi is amongst the largest MFIs in the country and is amongst the few MFIs that have significantly expanded their branch network and outreach post the MFI crisis (and subsequent regulatory changes) on the back of significant capital infusions.

IFC’s proposed investment will help Janalakshmi in its plan to become a comprehensive financial services provider for low income households, to diversify its sources of funding and to expand the outreach of access to microfinance to borrowers who have little or no access to formal sources of financing.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	19.90
Equity

IFC's loan to the financial institution described in this SII is targeted for on-lending to the following sector(s):

Product Type	Use of Proceeds
Straight Senior Loan	Loans to Microfinance Borrowers

IFC's Definitions of Targeted Sectors can be found here.

Development Impact

1. Access to Microfinance: This Project will help in expanding the outreach of access to microfinance to borrowers who have little or no access to formal sources of financing to women borrowers, including in low income states of India which have amongst the highest population densities and poverty rates in the country.
2. Balanced growth of Microfinance: This Project will promote a more balanced growth of microfinance in India. Janalakshmi''s operations are expanding in Western & Northern India where MFI penetration has historically been low. Additionally, the investment seeks to support an institution that has been a front-runner in adopting technology to enable financial inclusion.

1. Global Best Practices: IFC, through its global experience with MFIs and other low income financing entities is uniquely positioned to help Janalakshmi in its plan of becoming a comprehensive financial services provider for low income households.
2. Demonstration Effect: IFC''s investment would underline the faith in the sustainability of the microfinance business post the changed regulatory investment in addition to building investor confidence towards provision of financial services to low income households.
3. Diversification of Funding: IFC''s debt investment will help the Company diversify sources of funding by providing comfort to potential lenders and investors. IFC''s debt would also be for a longer tenor which would enable Janalakshmi to manage its asset liability gaps more efficiently.

E&S Category Rationale / Risks and Mitigation

The lending profile of the company is focused on retail microfinance products (92%) followed by working capital and long term capital loans to micro small and medium enterprises (MSME) sector (7%) engaged in manufacturing, trading and services sector such as auto ancillaries, metals forging, fabrication, motor winding, ready made garment stores, fast food restaurants, small nursing homes etc. The industry sector exposures on account of MSME financing overall comprises medium E&S risks. Largest loan size in this MSME segment has been under $ 50,000. Hence, the overall lending portfolio present potentially limited adverse environmental or social risks or impacts that will be few in number, generally site-specific, largely reversible, and readily addressed through mitigation measures. Hence, the E&S risk of the proposed investment is medium and the project is categorized as FI-2. The applicable Performance requirements will be i) the IFC- FI Exclusion List; and ii) The host country E&S laws and regulations.

Main E&S risks of the company’s lending operations primarily emerge from the Enterprise Finance Services (EFS) and Long Term Business Loan (LTBL) to MSMEs that operate in low to medium risk sectors of manufacturing, trading and services. The key risks and impacts relate to labour and working conditions, occupational health and safety issues and compliance to applicable environmental and social laws and regulations.

At present, the company is in process of implementing an adequate E&S risk management system. The company will put in place the E&S risk management system to ensure that its borrowers are in compliance with applicable E&S laws and regulations. The company will also appoint an officer in-charge for implementing the system and provide training to the relevant field staff on E&S risk management system/procedures. The company will also upgrade its HR policy to comply with IFC Performance Standard-2.

Contacts

For Inquiries About the Project, Contact

Janalakshmi Financial Services Private Limited
Rajashree Saroja Plaza, No 34/1, Andree Road,
Shanthinagar,
Bangalore, Karnataka,
India – 560027
http://www.janalakshmi.com

Ms. Hetal Faldu
mailto:hetal.faldu@janalakshmi.com

For Inquiries and Comments About IFC, Contact

General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

Task Title & Description	Anticipated Completion Date
Nominate officers	05/30/2014
Establish SEMS	06/29/2014
Formalize procedures	08/28/2014
Staff Training	08/28/2014
Occuptional health and safety procedure	08/28/2014

Projects

Summary of Investment Information

Project Description

Sponsor / Cost / Location

Development Impact

E&S Category Rationale / Risks and Mitigation

Similar Projects

Contacts

Projects

Summary of Investment Information

Project Description

Sponsor / Cost / Location

Project Sponsor and Major Shareholders of Project Company

Total Project Cost and Amount and Nature of IFC's Investment

IFC's Investment as Approved by the Board

FIG Use of Proceeds/Beneficiaries

Location of Project and Description of Site

Development Impact

Anticipated Impact Measurement & Monitoring (AIMM) Assessment

IFC's Role and Additionality

E&S Category Rationale / Risks and Mitigation

Environmental & Social Categorization Rationale / Key Risks & Potential Impacts

Environmental & Social Management System (ESMS)

Mitigation Measures / Environmental & Social Action Plan (ESAP)

Press-Release

Related Environmental Document

Similar Projects

Contacts

Information on E&S Complaints and Grievance Mechanisms

Disclaimer