Shriram Transport Finance secures $250 million in funding from US DFC
- ByStartupStory | June 13, 2022
Shriram Transport Finance Company Ltd. (STFC), a commercial vehicle financier and subsidiary of the Shriram Group, has received $250 million in long-term funding from the United States International Development Finance Corp. (DFC). Under STFC’s social finance framework, the $250 million in external commercial borrowing is a fixed-rate, 10-year loan.
STFC will be able to provide financing for the purchase of new and used vehicles thanks to the funds raised from DFC. Proceeds from DFC can be used for commercial vehicle financing, alternate fuel financing, specifically CNG, LPG, and electric vehicles; job creation through MSME loans, specifically financing women entrepreneurs, catering to laggard states of the country, and empowering and promoting the social and economic status of India’s underserved communities.
Umesh Revankar, VC & MD of Shriram Transport Finance stated that the company will assist more individual operators in purchasing vehicles for new markets, provide funding for rural job creation, and empower more communities to maximise their income and improve their quality of life. DFC’s investment in Shriram Transport Finance Company contributes to India’s economic growth, development, and financial inclusion, he further said.
DFC’s chief development officer, Andrew Herscowitz said that STFC will use the DFC loan to help green India’s commercial transportation sector, which has been notoriously difficult to decarbonize, by financing alternative fuel and lower-emissions vehicles.
Aside from the DFC loan, STFC successfully raised $475 million from the international market through a 144 A bond at the beginning of 2022.
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