AuHFL NCD (IFC-39725)

Regions
  • South Asia
Geographic location where the impacts of the investment may be experienced.
Countries
  • India
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Approved
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
FI
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Jun 19, 2017
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
AAVAS FINANCIERS LIMITED
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Finance
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 20.15 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 20.15 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Aug 3, 2018

Disclosed by Bank May 8, 2017

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to IFC website, IFC proposes to invest up to US$20 mn through subscription of Non-Convertible Debentures issued by Aavas Financiers Limited (AFL), formerly known as Au Housing Finance Limited. The proceeds of proposed IFC’s financing will be utilized by AFL for supporting affordable housing finance for purchase / construction & extension of house to individual under low and medium income group in Rajasthan (a low income state) and nearby 5 states. AFL’s customers include dairy farmers, carpenters, garment traders, artisans, etc. Currently, almost 65% of AFL’s customers are self-employed. 

1. Increased housing finance access in Low Income States: AFL is focused on providing access to housing finance to low-mid income borrowers in tier II /tier III/tier IV and peripheries of tier I cities, with 57% of its outstanding book in the low income states of Rajasthan and Madhya Pradesh. 

2. Increased housing finance access to self-employed and low income segment: AFL is focused on providing access to housing finance to low income borrowers, specifically those employed in the informal sector such as self-employed micro-entrepreneurs and un-organized sector salaried workers.

3. Job Creation: There is high demand for affordable housing, particularly in rural and semi-urban areas. The expansion of housing finance has a trickledown effect on job creation through the growth of the multiple industries

Investment Description
Here you can find a list of individual development financial institutions that finance the project.
Financial Intermediary
A financial intermediary is a bank or financial institution that receives funds from a development bank. A financial intermediary then lends these funds to their clients (private actors) in the form of loans, bonds, guarantees and equity shares. Financial intermediaries include insurance, pension and equity funds. The direct financial relationship is between the development bank and the financial intermediary.
Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

Established in 2011, Aavas Financiers Limited (AFL) was incorporated as a wholly owned subsidiary of Au Financiers Ltd. (Au), currently known as Au Small Finance Bank Limited. As part of its Small Finance Bank transformation process, Au sold its substantial stake in AFL. The company’s current shareholders include Kedaara Capital, Partners Group, Au, and the management team.

The Company is led by Mr. Sushil Agarwal, CEO, who is a senior banker with over 15 years of experience in housing and SME finance.


Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

Project Contact: Mr. Ghanshyam Rawat
CFO, Aavas Financiers Limited  
Contact No.: 0091-141-3910000
Email Address: ghanshyam.rawat@auhfin.in
Office Address: 201-202, 2nd Floor, Southend Square, Mansarovar Industrial Area, Jaipur - 302020, India
Website: http://www.auhfin.in/

ACCOUNTABILITY MECHANISM OF IFC

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org. You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org/

How it works

How it works