Axis Bank, in partnership with GuarantCo – part of the Private Infrastructure Development Group (PIDG) – has extended a ₹100 crore (about $12 million equivalent) guarantee to enable Muthoot Capital to on-lend to customers in rural and non-metro regions in India for purchasing electric two and three-wheelers.
GuarantCo has provided a 65 per cent on-demand credit guarantee to Axis Bank for this transaction, which is part of a broader $200 million (INR/Indian rupee equivalent) electric vehicle (EV) framework agreement signed by GuarantCo and Axis Bank, per a joint statement.
Boost for e-mobility ecosystem
This framework was established to enable mobilisation of funds between $300 and $400 million (INR equivalent) for financing the e-mobility ecosystem in India.
“This collaboration with (non-banking finance company) Muthoot Capital will focus specifically on providing transport solutions to rural and non-metro regions that predominantly consist of lower-income populations that have historically been underserved,” per the statement.
This is GuarantCo and Axis Bank’s third transaction under the EV framework agreement. In December 2023, it had first enabled an ₹250 crore ($30 million) loan to Vivriti Capital for supporting the company’s expansion strategy in the e-mobility ecosystem of India, and subsequently extended ₹100 crore ($12 million) loan to Everest Fleet for the purchase of electric cars to be deployed as low emission taxis.
Rajiv Anand, Deputy Managing Director at Axis Bank said, “We have proactively scaled up our partnerships and engagements with EV dealers, manufacturers, and other players and will continue to do so. This collaboration not only supports the development of green infrastructure in India but also aligns with our broader vision of fostering an inclusive future, where sustainable practices benefit all segments of society.’’
