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Financing the ‘missing middle’

Vistaar Finance in India

Vistaar Finance in India

Vistaar Finance caters to small and medium-sized enterprises in South India. This sector, which is crucial to India’s economy, has limited access to financial services and is often referred to as the ‘missing middle’.

Vistaar Finance is a non-banking institution located in Bangalore, providing access to finance to small and developing businesses in semi-urban and rural areas. Access to finance has given Mottusami, Dhodduraj and Natarajan and his brother Periyasami the ability to expand their businesses in the textile industry and employ a combined 28 employees in different regions within Bangalore.

Vistaar Financial Services

One of Dhodduraj’s employee is producing ‘jari’

Vistaar Financial Services Private Limited (Vistaar Finance) is a Bangalore-based institution catering to micro, small and medium enterprises in rural and semi-urban areas in South India.This sector, which is crucial to India’s economy, has limited access to organised financial services and is therefore often referred to as the ‘missing middle’. In terms of loan size, this is a target group just above the ‘traditional’ microfinance clients in India. The key businesses of Vistaar’s clients include mechanical weaving, small shops, traders and small manufacturing units.

Gold thread

Dhodduraj produces gold thread made from metallic and polyester; this thread is also known as ‘jari.’ Eight years ago, Dhodduraj founded his business eight years ago. Eight years later, he began looking for expansion opportunities in size and scope and thus sought the assistance of Vistaar Finance. In late 2014, Dhodduraj received his first loan from Vistaar Finance. His vision is to change how jari is currently produced by looking into more sustainable and effective means of production and to hire more employees in order to help to local economy and community.One of the ladies working on Mottusami’s team, changing the threads and checking the accuracy of the loom.


Mottusami  opened his textile business nine years ago with one power loom; however, the demand for saris exceeded his supply and he quickly started adding power looms to his inventory. He obtained his first loan from Vistaar Finance to buy his tenth power loom and to add more employees. He now  employs eight men and two women, producing about 800 saris per month.

Bangalore houses a variety of textile firms and many of the owners have been in business for decades. It is no surprise that some of the loans financed by Vistaar Finance are for entrepreneurs in this industry. Two such entrepreneurs are Natarajan and his brother, Pariyasami. Both began a joint partnership 15 years ago and started with just enough to buy three power looms. In the 15 years, their business grew at a steady pace. With the assistance of financing, they now own twenty power looms and employ 15 people. Their business is one of the larger textile organisations wtihin the Vistaar Finance portfolio.

Financing Vistaar

Natarajan often works with this type of power loom, which is much faster than producing woven cloth by hand.Vistaar, which means expansion, growth and evolution in Sanskrit, started its operations in 2010. Triodos Fair Share Fund and Triodos Microfinance Fund are Vistaar’s first foreign lenders, through a so-called Non-Convertible Debentures (NDC) transaction; the Indian equivalent of providing a loan. This loan will enable Vistaar to further realise its growth ambitions.

Inclusive Finance
Emerging Markets

Triodos Investment Management has been active as an investor in the microfinance/inclusive finance sector since 1994 through a number of specialised funds. At year-end 2014, these funds provide finance to over 102 microfinance institutions and banks in over 44 countries in LatinAmerica, Asia, Africa and Eastern Europe. They hold equity stakes in over 20 financial institutions; senior staff of Triodos Bank joins the Board of Directors and actively contributes to the governance of these institutions.

To find out more about Triodos Investment Management’s activities in emerging markets, renewable energy, arts and culture and more visit their blog, Welcome to Impact Investment.

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