Investment for development: The UK’s strategy towards Development Finance Institutions


  1. Aavishkaar Capital, part of the Aavishkaar Group.

1.1.   Aavishkaar believes that power of entrepreneurship can solve complex social problems at scale addressing social, environmental concerns while generating returns. The Group facilitates provision of capital to support the vision of entrepreneurial leaders whose business model integrate delivering impact profitably. Aavishkaar follows an ecosystem approach to its investing and believes that helps multiply the impact.

1.2.   Aavishkaar started in 2001 with its Founder personally investing USD 100 and borrowing USD 2000. Today, the Group manages asset in excess of USD 1.2 billion, has supported more than 60 entrepreneurs in India, South Asia and South East Asia, and increasingly in Eastern Africa, while creating more than 50,000 jobs and 500,000 livelihoods.


  1. What current investments does British International Investment (BII) hold and evaluate the impact of its investments?

2.1.   British International Investment (BII) has committed a total of USD 95mn across multiple Aavishkaar funds to enable it to support entrepreneurs to create jobs and livelihoods and reduce risk and vulnerabilities across low-income geographies and rural India.

2.2.   Aavishkaar has with BII support played a pioneering role in influencing the scale of Microfinance and the overall financial inclusion sector in India. For instance, the 2mn women micro borrowers supported in some of the most remote geographies of Eastern India through our investment in Arohan, or the scale and impact delivered by Utkarsh Small Finance Bank and Suryoday Small Finance Bank, both seeded by Aavishkaar.

2.3.   Aavishkaar identified agri-tech as a potential space for investment in India and is a pioneer investor in building the agri-tech space, investing in companies working in the space of farm productivity, input sales to farmers, exports of fruits and vegetables, decentralized warehousing and processed food that are green and sustainable such as millets.

2.4.   Aavishkaar’s intervention in AgroStar helped ~9mn farmers supported with real-time agronomy advisory services and access to quality farm inputs, thereby increasing farmers’ yields by 30-100%; our investment in Kottaram, that operates under the brand name Soulfull, converted millets that have a multi-layered impact on environment, income of marginal farmers, water conservation and soil health, to high end breakfast cereals, delivering significant leverage relative to the small size of the company.  Our investment in Ergos has allowed creation of 255 Grain Banks across rural landscape in India with thousands of farmers who can increase their income by 1.2 to 1.5 times every 6 months.  The union budget of India presented in 2023 talks about creation of decentralized warehouse as one of the key proposed government interventions confirming the pioneering nature of Ergos intervention. 

2.5.   Aavishkaar’s investment in Nepra has helped recycle 180,000 metric tons (MT) of waste and reduce 360,000 MT carbon emissions, while building India’s largest dry waste management company.

2.6.   Through its investment in Aavishkaar Funds, BII has played a significant role in enabling scale of these businesses in low-income geographies. 88% of our investees are first generation entrepreneurs, 76% of these companies have operations in low-income geographies in India and we are the first institutional investors in 88% companies. Further, BII’s intervention has helped Aavishkaar leverage commercial capital of 2x for every $ it’s invested.

2.7.   Many of these ventures would not have existed in the absence of Aavishkaar’s intervention as the first cheque at the seed stage. The business supported through the Funds have created ~270,000 jobs and livelihoods (43% women), provided ~7.2mn low-income borrowers (71% women) and ~158,000 micro, small and medium businesses with access to affordable finance, and another 60mn with financial services (50% women) and ~more than 3.8mn people (31% women) with access to essential services.

2.8.   BII has also taken direct investment positions in companies seeded through some of Aavishkaar Funds such as Equitas and Utkarsh (microfinance, small finance bank), and HR Foods (dairy). BII has also supported many of our portfolio companies through its various grant programs over the years. BII has also taken its partnership with us further with co-investments in 2 companies, which have been seeded through the Aavishkaar Funds viz. Agrostar and Ergos (agritech).