Non-banking financial company L&T Finance has signed a financing pact with the Asian Development Bank (ADB) for $125 million to support financing in rural and peri-urban areas in India, particularly for women borrowers.

The company said that the funding comprises of a loan of up to $125 million from ADB, and an agreement to syndicate an additional $125 million co-financing from other development partners. L&T Finance said, “At least 40% of the proceeds is allocated for women borrowers, while the rest will support farmers, Micro, Small and Medium-sized Enterprises (MSMEs), as well as loans to purchase new two-wheeled vehicles.”

The shares of the company ended higher in the trade on Thursday, November 23 at ₹141.85 apiece. 

“We believe this partnership with ADB is a significant step and will boost our ongoing efforts of bridging the financial gap and promoting inclusive economic growth across the country. For our Company, this long-term loan forms a part of our continuous strategy of diversifying our funding sources,” Sachinn Joshi, Group Chief Financial Officer, L&T Finance said.

L&T Finance in a statement said that despite steady rural economic growth, rural communities face significant barriers in accessing financial services. “About 70% of marginal farmers do not have a bank account, and 87% lack access to credit. Women are disproportionately affected, with only 14% having access to credit.”