A recent study emphasises the lack of growth stage impact funding targeted at India that are necessary to scale solutions to the point where they can have a global impact and advance the SDGs
Impact investing prospects in India for growth-stage investors have been highlighted in new research from the Impact Investors Council (IIC).
In India, the market for impact investing has expanded dramatically in recent years. Over the past five years, the number of deals worth more than $10 million has more than doubled, while the number of sales over $20 million or more has climbed by a ratio of 2.3.
Impact investments seek to generate a financial return in addition to having a favourable social or environmental impact. Pursuing social or environmental good does not necessarily entail forgoing financial gain. The majority of impact investment funds across categories generate a market rate of return.
There are no growth-stage impact funds with a focus on India. To scale solutions to a point where they can have an impact on the entire planet and contribute to the SDGs, growth-stage finance is required.
Till now, focus has been on early-stage investments in non-scalable technologies. But, impact investments are increasingly going beyond financial inclusion in India and into new fields including agriculture, excellent technology, healthcare, education, and livelihoods.
India is a desirable location since it has access to a youthful, skilled talent pool. Impact-driven businesses have a great opportunity to provide low-cost services for consumer groups who were previously ignored, thanks to the rising adoption of the internet and 5G technologies.
Digital adoption in India has made it possible for tech-enabled companies to scale their effect and promote innovation in up-and-coming industries like climate technology and the future of work.
The Indian market offers social entrepreneurs a significant potential to have a large-scale effect and bring in money for investors.
The stakeholders supporting the development of a catalytic environment for such investments are assisting the Indian impact investing ecosystem as it slowly changes.
The Indian government's numerous policy actions are helping to create a more favourable environment for growth-stage impact investing in India.
Atal Innovation Mission, was introduced in 2016 with the intention of offering infrastructure and technical support to businesses that concentrate on producing beneficial social and environmental results
An innovative platform called Social Stock Exchange (SSE) was created to fill the gap between investors and social entrepreneurs that work to advance environmental sustainability and social welfare.
Then there is the Samridhi Fund, established by the Small Industries Development Bank of India (SIDBI), which aims to finance social entrepreneurs that are commercially viable. The advent of such government-backed funds can inspire early-stage impact investors to assist growth-stage businesses that are developing novel business strategies, goods, and technologies that have a high likelihood of scaling up.