New Delhi, Sept 30: Private lender Axis Bank in partnership with GuarantCo, part of the Private Infrastructure Development Group (PIDG), has extended a Rs 1 billion (USD 12 million equivalent) guarantee to NBFC Muthoot Capital to expand footprint of electric two wheelers in the rural and non-metro cities.
This will empower the NBFC to lend to on-lend customers in rural and non-metro regions in India, for purchasing electric two wheelers, a joint press release stated.
GuarantCo has provided a 65 percent on-demand credit guarantee to Axis Bank for this transaction, which is part of a broader USD 200 million electric vehicle (EV) framework agreement signed by GuarantCo and Axis Bank. This framework was established to enable mobilisation of funds between USD 300 and 400 million (INR equivalent) for financing the e-mobility ecosystem in India.
This collaboration with Muthoot Capital will focus specifically on providing transport solutions to rural and non-metro regions that predominantly consist of lower income populations that have historically been underserved.
The transaction will benefit Indian companies operating within the EV ecosystem with over Rs 0.8 billion (USD 10 million) and expected to impact local businesses in the supply chain, such as equipment manufacturers, vehicle dealers and insurers.
The Rs 1 billion EV transaction will increase electric two and three-wheeler vehicle provision, contributing to SDG 9.4 (Upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies) and SDG 11.2 (Provide access to safe, affordable, accessible and sustainable transport systems for all), the release added.
Rajiv Anand, Deputy Managing Director at Axis Bank said “Axis Bank stands committed to support and accelerate the growth of e-mobility industry in India.
As one of the leading banks in the country, we are dedicated to driving initiatives that create positive environmental and social impact. By promoting the adoption of electric vehicles, we are working to reduce emissions, enhance air quality and provide affordable and accessible transport solutions nationwide.”
Mathews Markose, Chief Executive Officer at Muthoot Capital said “Partnering with GuarantCo marks a significant step forward in accelerating the adoption of electric vehicles and advancing sustainable transport solutions in our country especially in the rural and semi-urban markets. This funding will enable MCSL to provide innovative and tailor-made financing options aimed at making electric vehicles more accessible and affordable to a wide range of consumers and businesses.
We look forward to enabling the common man to own their own two-wheeler ensuring affordability and convenience. This will lend wings to our slated objective of growing our EV by 200 crores during FY25.” (UNI)
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