IFS Capital (SGX:I49), along with IFS Asset Management and Funds IGC, a subsidiary of Japan's Funds, signed an agreement to channel Japanese capital into private credit strategies for SMEs based in the Asia Pacific, according to a Thursday filing with the Singapore Exchange.

Shares of the company were up nearly 1% in Friday trading.

Under the agreement, the parties will work to fill a financing gap in the SME sector by providing income and portfolio diversification options to investors.