British International Investment

Vay Networks Services Pvt Ltd

South AsiaCommunications & IT services

Vay Networks is India’s largest network for trade financing. The company aims to accelerate the growth of supply chains by unlocking affordable and easily accessible trade credit for every member of the supply chain.

This investment was made when British International Investment was named CDC Group.

Our investment

Description of the investment.

Our co-investment alongside our GP Chiratae Ventures will help Vayana Networks scale its digital supply chain finance platform. This is expected to improve access to supply chain finance by disrupting trade credit economics in India.

Impact information

Applies to investments made from 2019 onwards. The tabs in this section define what we expect to achieve through the investment, assessing the potential impact of the investment against six dimensions of impact. You can find more details on our methodology of assessing impact here.

What?

Impact

Improved economic opportunities and resilience through better access to supply chain finance (SDG 8.3, 8.10)

How?

Primary Secondary

Catalysing markets: As the largest third party supply chain finance platform in India, Vayana disrupts trade credit economics by leveraging technology. It reduces lending cost compared to traditional supply chain finance models, which ultimately leads to more competitive financing for its network participants. Vayana makes the entire lending process more efficient and flexible, including the onboarding of new borrowers, documentation and transaction processing. This will help overcome the high structural cost of serving the smaller last-mile participants in the supply chain (i.e. MSMEs) and increase competition in the supply chain finance space.

Economic enabler: Our co-investment in Vayana will help the company to scale and further improve access to supply chain finance products in India and globally. This allows businesses and their suppliers/distributors to better manage their cashflows, liquidity and risk while enabling more frequent economic participation, ultimately leading to business growth and supply chain stability and integration.

Who?

Stakeholder Geography Characteristics
Suppliers/distributors and their employees

Mostly India. At the point of our co-investment, roughly 60 per cent of network participants were located in D states, approximately 25 per cent in A states and the rest in B and C states (using BII's 2017-2021 Development Impact Grid). The majority of borrowers were located in Tier-2 or smaller towns.

14 per cent of borrowers are female.

How much?

Scale Depth/Duration

The scale of impact is expected to be significantly greater than traditional supply chain finance models. As a proxy of scale, at the point of our co-investment Vayana had facilitated over $7 billion in cumulative financing flows.

Small suppliers are expected to benefit more than larger ones, due to the fact that they generally have lower access to capital and a larger difference in their credit ratings compared with their anchor buyers.

Contribution/additionality

Contribution/additionality
  • Financial additionality: Capital is not offered in sufficient quantity.

Grid score

Grid Score

To help us direct our investments, we previously used a tool called the Development Impact Grid. It scored investments out of four, based on two factors: the difficulty of investing in a country and the propensity of the sector to generate employment. This tool was used for investments until the end of 2021. Since 2022 it has been replaced by the Impact Score.

2.9

Risk

Execution Risk
  • This relates to Vayana’s ability to successfully scale up through onboarding new clients and further build out its service offering. This risk is correlated with commercial risk.

Reporting and Complaints Mechanism

The Reporting and Complaints Mechanism allows anyone outside BII to report alleged breaches of the business integrity or environmental and social provisions of BII’s Policy on Responsible Investing. This includes breaches made by BII, a BII investee, or a portfolio company of a fund in which BII has invested. The Reporting and Complaints Mechanism Rules are available here. Reports and complaints can be submitted by email to [email protected] or by mail. See more details on our Reporting and Complaints Mechanism here.

For any other general enquiries contact us at [email protected]

  • Key facts

    Last updated

    When the last quarterly update of the website database occurred.

    :
    March 2024
    Project number

    An identifier number shared by investments in the same project.

    :
    D5221
    Status

    The current status of the investment (green flag for active and red flag for exited).

    :
    Active
    Region

    The geographical region where the country is located. We currently invest in Africa, South Asia, South East Asia and the Caribbean. In 2023, BII’s investment mandate was extended allowing it to invest in regional funds linked to Ukraine, with the majority of activity expected to begin post-war. Investments outside these regions were made prior to 2012 under previous investment mandates.

    :
    South Asia
    Sector

    We prioritise those sectors that facilitate development and need our capital the most. Our priority sectors contribute towards many of the Sustainable Development Goals. They range from investing in the power infrastructure that will provide people with better access to electricity, to investing in financial institutions that direct capital to the individuals and businesses that need it the most.

    :
    Communications & IT services

    We provide capital in the following ways: directly – through direct equity, direct debt, guarantees and other non-intermediated financial instruments; and indirectly – principally through investment funds.

    For direct investments and fund investments, this is the date BII committed capital to the investments. This is typically the date on which legal agreements are signed by all parties.

    For the portfolio companies of our fund investments, this is the date (either the month or the quarter) on which the fund committed capital to the portfolio company.

    For direct equity investments, this is the date at which British International Investment exited the investment.

    For debt investments, this is the date at which the final debt repayment was made.

    For funds, this is the date at which the fund was terminated.

    For underlying fund investments, this is the date at which the fund manager exited the investment.

    The total amount committed, per financial instrument, per investment, on the date BII becomes subject to a binding legal obligation to provide funding or assume a contingent liability. This information is provided in US dollars.

    For direct investments, this is the amount that BII has committed to the business or project. For fund investments, this is the amount BII has committed to the fund.

    The currency in which the investment was made.

    Investment type :
    Equity
    Start date :
    October 2021
    Amount :
    $4m
    Currency of investment :
    INR
    Domicile

    The company or investment fund’s place of incorporation.

    :
    India

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