Muthoot Microfin Ltd has raised ₹250 crore through the allotment of listed, rated, secured and redeemable Non-Convertible Debentures (NCDs) on a private placement basis, as the microfinance lender looks to strengthen its funding profile and support its growth plans.
The NCDs will be listed on BSE Ltd. As part of the issue, the company allotted 2,50,000 NCDs with a face value of ₹10,000 each, aggregating to ₹250 crore.
The NCDs have a tenure of 24 months and carry a coupon rate of 9.25% per annum, payable monthly.
Funding profile
The fund raise is part of Muthoot Microfin’s strategy to diversify its liability mix and optimise its overall cost of borrowing while maintaining access to multiple sources of capital.
Muthoot Microfin CEO Sadaf Sayeed said the ₹250 crore fund raise would strengthen the company’s funding profile and access to diversified sources of capital.
“Our cost of funds declined by 75 bps in FY26, and we remain focused on consistently optimising our borrowing costs. The recent upgrade in our credit rating to CRISIL AA-/Stable further strengthens our ability to access funding at competitive rates and optimise our liability mix,” Sayeed said.
Over the medium term, the company expects the funding strategy to support margins while enabling it to continue growing and serving customers across its markets, she added.
Secured issuance
The fund raise is within the limits approved by the company’s Board of Directors and reflects continued investor confidence in Muthoot Microfin’s financial strength and growth trajectory.
The NCDs are secured by a first-ranking, exclusive charge over the company’s receivables, providing security to investors against the instruments.
The company said the recent credit rating upgrade to CRISIL AA-/Stable also strengthens its ability to access funding at competitive rates.
Focus on financial inclusion
Muthoot Microfin is part of the Muthoot Pappachan Group, also known as Muthoot Blue. The company provides microfinance services aimed at promoting entrepreneurship among women and supporting inclusive growth.
Its lending portfolio includes income-generating loans to women engaged in small businesses, particularly in rural and underserved markets. The company focuses on providing financial services at affordable terms, with quick turnaround and simplified processing.
As of June 30, 2026, Muthoot Microfin had 3.25 million active customers served through 1,671 branches across 21 states and 392 districts.
Its Gross Loan Portfolio stood at ₹14,457.2 crore as of the quarter ended June 2026. The company is also part of the S&P BSE Financial Services Index.
The latest NCD issuance adds another layer to the lender’s borrowing base as it seeks to balance growth, funding diversification and borrowing costs in a competitive microfinance market.