Vardan Ceqube India Investments Invests in NeRL

Vardan Ceqube India Investment, a domestic SEBI-registered AIF, has secured an equity stake in National E Repository Ltd. (Nerl) through the secondary market. This investment signifies confidence in NeRL's role within India's evolving digital warehousing ecosystem. Vardan Ceqube India Investment Fund, a recognised investment entity, has demonstrated its strategic interest in Nerl's operations.

NeRL plays a key role in the issuance and management of electronic negotiable warehouse receipts (eNWRs), contributing to increased transparency and efficiency in commodity storage and trade.

The Reserve Bank of India (RBI) in its recent master directions 2025 on Priority sector lending, wherein it has directed the chairman, managing directors, CEO of banks on Priority Sector Lending, has revised norms for pledge finance to farmers and non-farmers against Electronic Negotiable Warehouse Receipts (eNWRs). This move is poised to invigorate the Warehouse Development and Regulatory Authority (WDRA) ecosystem and make eNWR-led pledge financing more attractive for both lenders and borrowers.

Specifically, the RBI has increased the loan limits from Rs75 lakh to Rs90 lakh for loans to farmers, and from Rs75 lakh to Rs4 crore for loans to non-farmers, when these loans are secured by eNWRs. This revision is expected to provide greater financial access to those utilising warehouse receipts as collateral.

Interestingly, NeRL would be the direct beneficiary of these guidelines as it has the mandate to issue eNWRs. The investment is expected to bolster NeRL's growth and further develop the eNWR market. This move indicates increasing investor interest in companies that are building infrastructure to modernise India's agricultural supply chains.

Traditionally, warehouse receipts were paper-based documents, prone to forgery, damage, and cumbersome to handle. NeRL's eWRs, on the other hand, are stored securely in a digital format, eliminating these risks and streamlining the entire process. With this digital transformation, NeRL is going to contribute the same as CDSL and NSDL contributed to the securities market and have far-reaching benefits for various stakeholders.

NeRL plays a crucial role in the issuance and management of eNWRs. The RBI's revised guidelines are expected to:

A)Increase eNWR Adoption: The higher loan limits will incentivize both farmers and non-farmers to utilize eNWRs, leading to increased adoption of the digital warehousing system

B)Boost NeRL's Business: As the volume of eNWRs increases, so will the demand for NeRL's services, resulting in a positive impact on its business operations.

C)Enhance Transparency and Efficiency: eNWRs provide a secure and transparent mechanism for warehouse transactions, and the RBI's move will further promote these benefits.

D)Expanding financial inclusion: By making warehouse reciepts more viable as collateral, more farmers will be able to access formal financial systems.

Nerl's mandate is a compelling digital India story, driven by the vision to empower farmers, enhance market access, and promote financial inclusion with its growing network of warehouses, banks, and other stakeholders. NeRL is rapidly expanding its reach and impact.

The RBI's decision underscores the growing importance of digital warehousing solutions in India's agricultural and commercial sectors. By facilitating easier access to credit, these revised guidelines are expected to contribute to a more robust and efficient financial ecosystem, "Vikram Kaushal- Managing Partner of Vardan Ceqube"