AUF is a rapidly growing company, reflecting the underserved nature of its core market. Besides growing its core business of transportation services financing, AUF is also diversifying into providing financing for housing and small business enterprises (usually linked to the transportation sector).

AUF’s debt requirements grow in line with its portfolio growth, and its strong track record and good portfolio quality has meant it has been able to raise financing from Indian banks and financial institutions when required. However, to ensure that its funding arrangements keep pace with its growth plans, AUF needed to diversify its sources of funding. The facility, provided by GuarantCo, FMO and CDC Group, will provide AUF with stable long-term funds with which it can continue providing affordable loans to small entrepreneurs.

AUF provides financing predominantly for small entrepreneurs engaged in commercial passenger/ goods transport services in rural and semi urban areas of India. Over 50 percent of AUF’s portfolio is in Rajasthan, one of India’s poorest states.

These small entrepreneurs play an important role in the provision of transportation services in rural and semi urban India but are unable to get financing from banks due to their lack of credit history and small loan sizes.

Such small entrepreneurs are usually lowly paid employees working in the transportation sector. AUF’s financing provides them an opportunity for social and economic mobility by owning their own vehicles or other productive assets.

The facility provided will help AUF provide circa 15,000 small loans, directly benefitting around 22,000 people and indirectly benefitting many more.