January 14, 2020
The capital investment will bolster KIFS’ position in India’s structured credit space, enabling them to partner with borrowers with long-term capital needs
Over the past decade, KIFS has deployed over US$5 billion of Indian credit investments across 150 deals covering a variety of sectors, as per the company
KKR will fund its commitment to KIFS through the firm’s balance sheet, and the proceeds of the investment will be used for general corporate purposes
India has off late seen a rise of NBFCs exclusively in the form of fintech companies that have seen the employment of the latest innovations and investor capital
In a press release on January 14, global investment firm KKR announced that it has committed to invest an additional US$150 million in KKR India Financial Services (KIFS), its Non-Banking Financial Company (NBFC) business in India. The new capital will bolster KIFS’ position in India’s structured credit space and will enable the Company to continue to partner with Indian borrowers with long-term capital needs.
Over the past decade, KIFS has deployed over US$5 billion of Indian credit investments across 150 deals. Apart from providing financing solutions, KIFS handles alternative asset management and capital market strategies and is supported by KKR’s international expertise. KKR will fund its commitment to KIFS through the firm’s balance sheet, and the proceeds of the investment will be used for general corporate purposes.
Commenting on the announcement, Sanjay Nayar, CEO of KKR India & KIFS, said, “Private lending in India is more important than ever. India has been an important part of KKR’s global growth strategy in Asia, and this investment reinforces KKR’s commitment to the region and provides KIFS with additional resources to enable the continued success of its business.”
KKR’s investment is sure to provide a boost to the Indian NBFC sector. In the statement, KKR’s co-presidents and co-chief operating officers, Joe Bae and Scott Nuttall said this is a “unique” time in the Indian credit markets, with many lenders being unable to invest despite a demand for alternative credit.
A strong, resilient and robust financial sector is essential for sustained economic growth and for instilling confidence among investors, domestic and foreign alike. This vigilance is all the more crucial for a growing economy such as India’s, which continues to attract foreign businesses and investments. At last year’s Fintech Conclave organised by NITI Aayog, attended by over 300 stakeholders, a dedicated group on fast-tracking investment in the fintech sector outlined the need for open banking in India, along with a new subclass of non-banking finance companies (NBFCs) exclusively for fintech companies to encourage innovation while expanding scope for investor capital.