GuarantCo provided an INR 1 billion (c. USD 12 million equivalent) guarantee to Axis Bank, one of the largest private sector banks in India, for a loan to Muthoot Capital, one of India’s fastest growing non-banking financial companies. The guarantee will cover up to 65 percent of the loan. The transaction is expected to benefit Indian companies operating within the EV ecosystem, with over INR 0.8 billion (c. USD 10 million) to be paid to local businesses in the supply chain such as equipment manufacturers, vehicle dealers and insurers.

The guarantee is provided under the USD 200 million (INR equivalent) electric vehicle (EV) framework guarantee agreement signed by GuarantCo and Axis Bank allowing mobilisation of funds between USD 300 and 400 million (INR equivalent) to finance the e-mobility ecosystem in India.

This is GuarantCo’s third transaction under the Axis Bank EV framework agreement which has first enabled an INR 2.5 billion (c. USD 30 million) loan to Vivriti Capital to support the company’s strategy to expand its portfolio through lending to companies operating in the e-mobility ecosystem in India. Secondly, the framework has enabled Axis to issue an INR 1 billion (c. USD 12 million) loan to Everest Fleet for the purchase of electric cars to be deployed as low emitting taxis in India, both in December 2023.

The proceeds of the loan will be used by Muthoot Capital to on-lend to customers in rural and non-metro areas in India for purchasing electric two wheelers. These areas predominantly consist of lower income populations and have historically been underserved by services.

The INR 1 billion EV transaction will increase electric two-wheeler vehicle provision, contributing to SDG 9.4 (Upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies) and SDG 11.2 (Provide access to safe, affordable, accessible and sustainable transport systems for all).