New Delhi: Vivriti Asset Management is set to launch an innovative fund that focuses on investing in small and medium-sized businesses, making it the first of its kind in the country to specialize in private credit investment in asset-backed securities. The founder and managing director of Vivriti, Vineet Sukumar, shared in an interview that their Chennai-based company has ambitious plans to secure a total of USD 250 million for their newly established ‘Vivriti India Retail Assets Fund’. To date, they have successfully raised USD 106 million from notable investors such as the International Finance Corp (IFC) and M&G Investments.
Sukumar mentioned that they have a target period of 18 months to raise the remaining funds, and the fund itself will have a term of 10 years.
Under Vivriti’s new initiative, mid-sized non-bank financial enterprises and microfinanciers will have the opportunity to sell their loans in various sectors, such as SME financing, commercial vehicle lending, two-wheeler funding, and microfinancing. These loans will be acquired by a special purpose vehicle (SPV) established by Vivriti, which will raise funds from the company’s credit fund through the issuance of securities backed by loan receivables.
The USD 250 million funds will be headquartered in India’s GIFT city and will have a diversified portfolio consisting of 40 to 50 asset-backed security (ABS) investments at any given time. This approach ensures that the fund maintains a well-managed level of risk by limiting exposure to a single investment to a range of USD 5 million to USD 7 million, as outlined by Vivriti.
By creating this fund, Vivriti Asset Management aims to facilitate growth and provide crucial financing opportunities to small and medium-sized enterprises in India, contributing to the development of the country’s economy.
