Business Model of Northern Arc
Northern Arc Capital Limited’s business model is based on providing access to debt finance for under-served households and businesses in India through a platform approach that involves four key elements:
Northern Arc Capital Limited evaluates the credit risk of its clients and borrowers using a combination of proprietary quantitative data analytics and qualitative field-level insights. It also uses its integrated technology system called Nimbus to enable efficient and scalable transactions.
Northern Arc Capital Limited creates relevant and customized investment products for its investors based on their risk-return preferences and social impact objectives. It also co-invests with its investors to align incentives and share risks.
Northern Arc Capital Limited monitors the performance of its clients and borrowers using various tools and indicators. It also manages the liquidity, interest rate, currency and operational risks associated with its transactions.
Market & investor relations:
Northern Arc Capital Limited sources capital from various investors such as banks, mutual funds, insurance companies, development finance institutions, impact investors and high net worth individuals. It also maintains strong relationships with its investors and provides them with timely and transparent information.
Northern Arc Capital Limited also offers fund management services through its subsidiary Northern Arc Investments, which manages various funds that invest in high quality and high impact debt instruments.
Funding in Northern Arc Unlisted Share
|Total Funding Raised
|Total Number of Funding Rounds
|Latest Funding Round Type
|Date of Latest Funding Round
|March 14, 2023
|Amount Raised in Latest Funding Round
|₹3.3B (approx. $44M)
|Investors in Latest Funding Round
|GuarantCo, Axis Bank
|Total Number of Investors
|Northern Arc Impact Fund (NAIIF)
|Total Raised Across Funds
|Latest Fund Announcement Date
|December 22, 2022
|Amount Raised in Latest Fund
Some of the key events in the history of Northern Arc are:
2009: Northern Arc was founded as IFMR Capital Finance Limited, a platform to provide access to debt finance for under-served households and businesses in India.
2010: Northern Arc executed its first securitization transaction with a microfinance institution.
2012: Northern Arc launched its first fund, IFMR FImpact Long Term Multi Asset Class Fund, to invest in high quality and high-impact debt instruments.
2014: Northern Arc became the first NBFC in India to issue a rated bond backed by microfinance loans.
2016: Northern Arc received equity investments from Standard Chartered Private Equity, Dvara Trust and LeapFrog Investments.
2017: Northern Arc executed its first international bond issuance under the Medium Term Note (MTN) programme.
2018: Northern Arc rebranded itself from IFMR Capital Finance Limited to Northern Arc Capital Limited.
2019: Northern Arc received equity investments from IIFL Special Opportunities Fund and Affirma Capital.
2020: Northern Arc launched its integrated technology system called Nimbus to enable efficient and scalable transactions.
2021: Northern Arc raised over INR 4,000 crore during the year, nearly a 50% increase over FY20, and partnered with several reputed global Development Finance Institutions including US DFC, FMO and CDC.
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