Northern Arc, a diversified non-banking finance company, has launched its performing credit AIF fund (Category II) – ‘Finserv Fund’ through its subsidiary, Northern Arc Investment Managers (NAIM). The fund aims to raise a target corpus of ₹1,500 crore, including a green shoe option of ₹500 crore.
The Finserv fund aims to make a significant impact on financial inclusion and economic growth across the six sectors: MSME, affordable housing, vehicle finance, agriculture finance, microfinance and consumer finance.
Ashish Mehrotra, Managing Director & CEO of Northern Arc, said “the Finserv Fund launch marks another significant milestone in Northern Arc’s mission to bridge the financial gap for underserved individuals and businesses by leveraging our pivotal strengths in proprietary data and technology”.
Bhavdeep Bhatt, Chief Executive Officer of Northern Arc Investments, said “The Finserv Fund is the 11th AIF launch from our fund management platform apart from the two PMS funds we manage. We have successfully closed and exited four funds at higher-than-targeted returns to our investors. This Finserv Fund will invest in a well-diversified portfolio across 45-55 entities within our key sectors”.
This fund targets gross returns of 14.00-14.50 per cent XIRR over its four-year tenure, with a deployment period of approximately six months from the final close, he said.
Northern Arc manages an AUM of ₹14,639 crore through its balance sheet and active AIF funds as of June 30, 2024.
Through the Finserv Fund, Northern Arc aims to provide long-term debt capital to financial intermediaries focused on lending to underserved and unserved segments, thus enabling access to finance for all.