"Providing asset finance to agro related small & micro business will enable them expand their operations and create more employment opportunities," IFC said.
Uco has become the second lender to face business restrictions after IDBI Bank after RBI revised its PCA framework last month.
The bank's operating profit fell 79%at Rs 119 crore from Rs 568 crore a year ago while total income fell 6.5% at Rs 3906 crore (Rs 4178 crore).
The small finance bank will be called Fincare Small Finance Bank, and will commence operations in July this year.
The bank board approved the plan to issue up to 6.2 crore shares at a meeting Thursday.
IFC’s investment is likely to be completed in a week’s time.
IFC’s investment is likely to be completed in a week’s time, Grameen Koota Managing Director Udaya Kumar told ET.
The non-banking finance company will issue non-convertible debentures subscribed by IFC to MSME's.
Flushed with liquidity following the government’s dramatic announcement, banks have been forced to cut deposit rates, which has in turn made loans cheaper.
In a disclosure, IFC said it would subscribe to Bajaj Finance's non convertible debentures for on-lending to micro small and medium enterprise.
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