European private equity group EQT has completed its acquisition of Niwas Housing Finance ( formerly known as Indostar Home Finance ) from IndoStar Capital Finance via the BPEA EQT Mid-Market Growth Partnership fund and will invest 5 billion Indian rupees ( US$58 million ) as growth capital to support Niwas’ geographic expansion and enhance its digital capabilities.

This transaction, EQT notes, marks a significant milestone in Niwas’ journey as it expands its presence across India. Founded in 2017, Niwas provides affordable mortgages to retail customers in tier-2 to tier-4 cities in India and has supported over 47,000 low-income homeowners and small businesses. Niwas has assets under management of over 30 billion rupees as of March 31, comprising granular, retail and secured loans.

India’s 30-plus-trillion-rupee housing finance market presents a compelling long-term opportunity, the private equity group argues, driven by urbanization, rising middle-income households and strong government support for affordable housing.

The sector has shown resilience across economic cycles and plays a critical role in advancing financial inclusion. This transaction reinforces EQT’s strategic focus on financial services in India, it shares, a sector benefiting from the secular growth of the country’s expanding middle class and rising demand for accessible financial solutions.

Niwas is well positioned to serve this demand, the private capital group points out, and will benefit from its in-house digitalization expertise, network of industry advisers and expertise in go-to-market strategies.

“India’s retail lending sector continues to offer exciting opportunities and is a key investment theme for EQT in India,” adds Hemant Sharma, a partner on the EQT Private Capital Asia advisory team. “With the acquisition of Niwas, we are deepening our commitment to the sector following our investment in the education finance space through Credila last year. We look forward to supporting Niwas in scaling operations across India, accelerating digital transformation and enhancing governance.”