Bank of America has agreed to buy as much as 49.9 percent of Jio Credit, the lending arm of Jio Financial Services, in a deal worth close to 18,268 crore rupees, or about 1.9 billion dollars. The agreement was announced this week and marks one of the largest foreign investments into an Indian non-bank lender this year.

Under the deal structure, Bank of America will first acquire a 26.5 percent equity stake in Jio Credit. That stake can grow to 49.9 percent later through the exercise of warrants, according to regulatory filings tied to the transaction. Shares and warrants will be issued to Bank of America on a preferential basis rather than through an open market purchase.

Jio Credit oversaw roughly 3.2 billion dollars in assets as of the end of June. The company is a relatively young entrant in India’s crowded lending market, built on the same Reliance backed infrastructure that turned Jio into the country’s largest telecom operator over the past decade.

Once the transaction closes, Jio Credit’s board will carry equal representation from Jio Financial Services and Bank of America, giving the American bank a direct hand in how the lender is run rather than a passive financial stake. The deal still needs regulatory and statutory approvals in India before it can be finalized.

For Bank of America, the investment is a bet on India’s credit market, where digital lenders have been growing faster than traditional banks as more borrowers move online. For Jio Financial Services, the partnership brings both fresh capital and a name recognized by global investors, at a time when the company has been trying to prove it can compete with established players like Bajaj Finance and HDFC.

Mukesh Ambani’s Reliance Industries spun off Jio Financial Services as an independent, publicly traded company in 2023. Since then the unit has pushed into insurance, asset management and now consumer and business lending, positioning Jio Credit as one of its fastest growing pieces.

Neither company has disclosed a target closing date for the transaction. Both said in statements this week that the deal remains subject to customary conditions and approval from Indian regulators.