SKS Microfinance, India's largest lender to the country's poor, has mandated three investment banks for its initial public offering in what would be the first listing of its type in the country.

SKS has hired Citigroup, Credit Suisse and domestic investment bank Kotak to advise on the $200m-$250m listing, which will give international investors their first taste of one of the world's biggest markets for micro lending.

“This is still a new sector and it needs capital,” said one person familiar with the deal. “It's very profitable and highly scaleable and we'll see some of these microfinance companies growing 100 per cent year-on-year.”

SKS, founded by former McKinsey consultant Vikram Akula, declined to comment on the offering. Citi, Kotak and Credit Suisse also declined to comment.

Microfinance has shot to prominence after Mohammed Yunus, the founder of Bangladesh microfinancier Grameen Bank, won a Nobel Prize in 2006 for his efforts to give the poor access to credit.

Today, there are by some estimates $25bn of microfinance loans outstanding globally, making the sector one of the hottest growth areas not only for traditional state banks but also for private financial groups and private equity firms.

Investors in SKS include Sandstone Capital, a US hedge fund, and Sequoia Capital, a private equity group that previously has worked with Apple and Google.

SKS, which is expected to file the draft prospectus for its IPO in the coming few months, will join Mexico's Compartamos, which staged a listing in 2007 that raised $400m.

Other micro lenders that have already gone public include Tanzania's National Microfinance Bank, which listed last year on the local stock exchange, while a large number in Bangladesh and other countries are also looking to hold IPOs.