Germany’s DEG makes maiden bet on India debt fund via Vivriti’s GIFT City vehicle, sources say

MUMBAI: German development finance institution DEG has approved its first-ever investment in an Indian debt fund, committing capital to Vivriti Asset Management’s asset-backed securitisation fund based in GIFT City, two people familiar with the matter said.

Indian Prime Minister Narendra Modi is pitching GIFT City as a finance hub to rival centres like Dubai and Singapore.

DEG, part of the KfW Group, will invest $25 million in Vivriti India Retail Assets Fund, the country’s first ABS fund based in GIFT City, to support lending to micro and small enterprises and women entrepreneurs, one source said.

The sources requested anonymity because the deal is private. Vivriti did not respond to emailed requests for comment by publication time.

DEG confirmed on email that it has made an investment in VIRAF recently and that it was its first Indian debt fund investment.

The development finance institution has previously backed Indian private equity funds and made direct equity and debt investments in Indian companies.

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With DEG’s commitment, the fund’s corpus will rise to about $190 million, nearing its $250 million target. Other investors in the fund include M&G Catalyst, the International Finance Corporation and British International Investment, the sources said.

Asset-backed securitisation bundles pools of loans together that are sold to investors. They are typically issued as bonds that pay periodic income and return principal at maturity.

The Vivriti fund has a 10-year term, and the asset manager can recycle the $250 million multiple times, one of the sources said, adding that this will enable them to make up to $1 billion of deployments over the decade.

As of December 2025, the fund had cumulatively invested $285 million across 72 asset-backed securitisation and bond transactions.