Earlier, Avigo Capital had invested Rs 150 crore in Religare Finvest.
While the company officials were not available for comments, sources close to the development said that the deal could be concluded shortly.
Religare Finvest provides debt capital to MSMEs (micro, small and medium enterprises) in form of loans against property, working capital loans, loans against plant and machinery, vehicles and construction equipments and loan against marketable securities, among others.
The company has more than 25,000 MSME accounts and its loan book stood at about Rs 11,400 crore as on September 30.
The PE fund is expected to help the company meet its growing capital requirements.
The deal comes at a time when various regulatory changes are taking place in the non-banking financial sector.Besides, a continuous rise in interest raqtes has also put pressure on the business margins for the NBFC sector, while the shares of listed companies have been hurt badly in recent months.