The project entails ADB providing longer-term financing to Chola, a leading nonbank finance company, for onlending to micro, small and medium-sized enterprises (MSMEs), half of which will be from the lagging states in India. ADB’s financing will meet Chola’s requirements for medium-term funds, which will help fund longer-tenor MSME loans and diversify Chola’s funding mix. Given the slowdown in credit growth from banks in India in FYE 2018, ADB’s funding will also have a countercyclical benefit on MSMEs’ access to finance, translating into economic growth and employment.
The report and recommendation of the President to the Board of Directors (RRP) document describes the terms and conditions of a project for consideration and approval by ADB's Board of Directors. This document dated November 2017 is provided for the ADB project 51195-001.