ICICI Bank, with five other financial intermediaries, has set up a Rs 800 crore India Advantage Fund for the equity component of small- and medium-sized enterprises (SMEs).
The bank has invested Rs 200 crore in the fund. The other partners include the Life Insurance Corporation of India, Punjab National Bank and Oriental Bank of Commerce.
H N Sinor, joint managing director of ICICI Bank, said the fund had closed with a corpus of Rs 800 crore. Although SMEs obtained debt funding from banks and financial institutions, they often lacked the capital to support their ventures.
“Since small and medium enterprises are highly leveraged, risk capital is hard to come by,” Sinor added.
ICICI Bank initiated the fund under the aegis of ICICI Ventures Fund Management Company Ltd, a venture capital subsidiary. It has already started financing new privately held business ventures.
