International Finance Corporation (IFC) has decided to invest up to $5 million in Financial Information Network & Operations (Fino), a technology service provider offering end-to-end IT solutions that help banks reach under-served rural markets in India.
“The investment comprises common equity of up to $2.5 million and convertible preferred shares of up to $2.5 million,” notes an IFC press statement issued on Wednesday.
In India, IFC’s outstanding portfolio is $1.3 billion (as of June 2006) making it IFC’s fourth-largest country of operations. As the private sector arm of the World Bank Group, IFC has been showing interest to develop the rural banking market.
According to rough estimates, a whopping 60 crore rural poor in the country are either not served or are underserved by the formal financial sector. Accordingly, this investment is expected to improve the financial system across the hinterland.
Micro finance institutions (MFI), in particular, will be benefited through the strengthening of their financial and operational management systems. It will also support mobile banking solutions that enable rural banks, co-operatives, and MFIs to provide cost effective services.
Source : ET