Muthoot Microfin Raises Rs 250 Crore via NCDs

MUMBAI - Muthoot Microfin Limited, one of India’s leading listed microfinance institutions, announced on September 14, 2026, that it has successfully raised 2.50 billion rupees (₹250 crore) through the allotment of listed, rated, secured, and redeemable Non-Convertible Debentures (NCDs) on a private placement basis. The financial instruments will be listed on BSE Limited. This strategic debt issuance aims to strengthen the company’s funding profile, diversify its liability mix, and reduce overall borrowing expenses amid expanding micro-lending operations across India.

Strategic Debt Issuance and Structure

According to official regulatory filings and company statements released by Muthoot Microfin Limited, the private placement comprises 2,50,000 secured NCDs with a face value of ₹10,000 each. The tenure of these debentures is set at 24 months, carrying a coupon rate of 9.25% per annum, payable on a monthly basis.

The issuance is backed by a first-ranking, exclusive charge over the company's receivables, providing strong security backing for investors. The fundraising transaction successfully complies with the authorized limits approved by the company's Board of Directors.

Financial Context and Credit Rating Support

The latest capital raise aligns with Muthoot Microfin’s broader financial roadmap to optimize liability management. The company noted that its cost of funds experienced a reduction of 75 basis points during fiscal year 2026.

Furthermore, this financial maneuver is bolstered by a recent credit rating upgrade to CRISIL AA-/Stable, which enhances the institution's capacity to source capital at competitive market rates. Over the medium term, these capital adjustments are projected to protect net interest margins while supporting responsible asset growth.

Impact on Stakeholders and Market Presence

For investors and market participants, the successful NCD allotment reflects continued institutional confidence in Muthoot Microfin's operational framework and asset quality. Operating under the umbrella of the Muthoot Pappachan Group (Muthoot Blue), the institution caters extensively to women entrepreneurs through micro-loans designed for income-generating small businesses.

As of June 30, 2026, Muthoot Microfin maintains an active customer base of 3.25 million handled across 1,671 branches spanning 21 states and 392 districts, alongside a Gross Loan Portfolio (GLP) of ₹14,457.2 crore. The firm is also a constituent of the S&P BSE Financial Services Index.

Official Sources Section

Information for this report is based on official corporate disclosures, regulatory notifications, and press releases issued by Muthoot Microfin Limited pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Quote Section

"The ₹250 crore fund raise is an important step towards strengthening our funding profile and maintaining access to diversified sources of capital," stated Sadaf Sayeed, CEO of Muthoot Microfin Limited. "Our cost of funds declined by 75 bps in FY26, and we remain focused on consistently optimising our borrowing costs. The recent upgrade in our credit rating to CRISIL AA-/Stable further strengthens our ability to access funding at competitive rates and optimise our liability mix."

Why It Matters

Securing long-term institutional debt at competitive coupon rates allows microfinance institutions to stabilize lending rates for economically vulnerable and rural borrowers. By diversifying capital sources, Muthoot Microfin insulates its balance sheet against market volatility, ensuring uninterrupted credit flow to women-led micro-enterprises across semi-urban and rural regions.

Key Facts at a Glance

• Total Capital Raised: ₹250 crore (2.50 billion rupees) via private placement of NCDs.

• Instrument Specifications: 2,50,000 secured NCDs valued at ₹10,000 each, featuring a 24-month tenure and a 9.25% annual coupon rate.

• Listing Exchange: BSE Limited.

• Credit Standing: Backed by a CRISIL AA-/Stable credit rating upgrade.

• Portfolio Reach: Gross Loan Portfolio stands at ₹14,457.2 crore serving 3.25 million active customers.

FAQ Section

1. What is the total amount raised by Muthoot Microfin through NCDs?

Muthoot Microfin raised ₹250 crore (2.50 billion rupees) through the private placement of secured Non-Convertible Debentures.

2. What are the key terms of the NCD issuance?

The NCDs carry a tenure of 24 months with a coupon rate of 9.25% per annum, payable monthly, and are secured by an exclusive charge over company receivables.

3. Where will the NCDs be listed?

The debentures are designated for listing on BSE Limited.

4. How does this fund raise impact Muthoot Microfin's operations?

It optimizes the company's borrowing costs, diversifies its liability mix, and supports ongoing microfinance lending operations across 21 states.

Source: Muthoot Microfin Limited - BSE/NSE Regulatory Filing & Press Release