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UGRO Capital, an MSME-focused lending platform, has raised INR 380 crore through the issuance of 38,000 senior, secured, rated, listed NCDs, fully subscribed by FMO, the Dutch entrepreneurial development bank. This is FMO’s third investment in UGRO Capital in under three years, following NCD investments of INR 250 crore in December 2023 and INR 260 crore in February 2025.
The five-year instrument matches the long-duration secured lending UGRO extends to small businesses in Tier-3 towns and beyond. Proceeds will go toward financing women-owned and youth-owned SMEs, rural SMEs and eligible green projects, in line with FMO’s mandate.
UGRO has now raised over INR 1,300 crore in debt from development finance institutions and impact-focused investors, including FMO, IFU, the Asian Development Bank, Triple Jump, BlueOrchard, responsAbility, Calvert Impact Capital, Enabling Qapital, GMO, WaterEquity and MicroVest. The company’s Social Impact Report 2024-25, verified by Dun & Bradstreet India, maps its portfolio to eight UN Sustainable Development Goals.
UGRO serves businesses with turnover below INR 3 crore that lack conventional tax and audit records, using its proprietary GRO Score to assess borrowers on banking cash flows, lending against property at an average ticket of INR 18 lakh. About 80% of this Emerging Market portfolio is in Tier-3 geographies and beyond, spread across 317 branches in 13 states.
GROx, UGRO’s embedded merchant finance platform, extends working capital of around INR 1 lakh on average to kirana stores, agri-input dealers and other nano-enterprises. In Q1 FY27, GROx disbursed INR 1,853 crore with AUM rising 32% quarter-on-quarter to INR 3,003 crore, serving about 3.4 lakh active customers and originating over 60,000 loans monthly. Together, the Emerging Market and GROx portfolios accounted for 46% of total AUM as of June 30, 2026, up from 32% in December 2025.
According to the company’s impact report, 76% of borrowers have a woman owner or co-owner, and 88% reported revenue growth after UGRO financing.
“FMO investing in UGRO for the third time in three years says something about the way development capital now views MSME lending in India. Every rupee that development finance institutions place with UGRO goes into that segment, is tracked against defined SDG outcomes and is independently verified,” said Shachindra Nath, Founder, Vice Chairman and Managing Director, UGRO Capital.
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