Capital India Finance Limited (“CIFL”) announced that the company has signed a Memorandum of Understanding (MoU) with Union Bank of India (“Union Bank”), for co-origination of loans under the co-origination guidelines prescribed by Reserve Bank of India.
The finance company said that this arrangement will enable CIFL to cater to a large section of unserved customers in the small and emerging corporate segment through an efficient blend of economically priced and innovative financing solutions. The company further added that this collaboration would require joint contribution of credit at the facility level, by both lending partners, i.e. the Union Bank and CIFL.
It is envisaged that the benefit of low-cost funds from Banks and efficient operations of NBFC would be passed on to the borrower through adoption of blended products to suit the requirements of borrowers. The model envisages sharing of risks and reward between the Bank and the NBFC by ensuring appropriate alignment of respective business objectives. This partnership will promote increase in the credit off-take in respective market and offer timely delivery of the credit at significantly lower cost.
Speaking on the partnership, Mr. Keshav Porwal, Managing Director – CIFL stated “This partnership with the Union Bank will be an enormous platform to provide support to SMEs and MSMEs in line with policy of the Government of India”. Mr. Amit Kulshreshtha, Executive Director & Chief Executive Officer – CIFL added “It is a proud moment for CIFL to partner with the Union Bank and jointly support the growth of emerging corporate sector in India”.
On Thursday, shares of Capital India Finance closed 1.72 per cent lower in BSE at Rs.140.00 as compared to the previous close of Rs. 142.45. The stock hit an intraday high of Rs. 140.00 and intraday low of 140.00.
On the other hand, shares of Union Bank of India closed 2.38 per cent down at Rs.55.45 on Thursday as compared to the previous close of Rs. 56.80. The stock hit an intraday high of Rs. 56.90 and intraday low of 54.45.