Bengal Small and tiny entrepreneurs get more to spend
The National Bank for Agriculture & Rural Development (Nabard) has recently allowed nearly a dozen rural cooperative banks to raise their respective single borrower exposure limits on loans to small businessmen.
By Atmadip Ray, TNN |
KOLKATA: Small and tiny entrepreneurs in West Bengal will now be able to avail of a higher loan amount from state-level rural cooperative banks for setting up business ventures. The National Bank for Agriculture & Rural Development (Nabard) has recently allowed nearly a dozen rural cooperative banks to raise their respective single borrower exposure limits on loans to small businessmen.
The move conforms to the state government's initiative to channelise more bank loans to the small and tiny sector. It has urged banks in the state to lend Rs 3,000 crore during 2007-08 to small scale industries. Out of this target, the cooperative banks, as a cluster, are supposed to offer Rs 200 crore worth of loans to SSIs.
Nabard has raised the single borrower limit on loans from West Bengal State Cooperative Bank (WBSCB) and 10 central cooperative banks (CCBs) to tiny entrepreneurs. While it has doubled the exposure limit to Rs 50 crore in case of WBSCB and Bankura District Central Cooperative Bank, it raised the limit to Rs 35 crore from Rs 25 crore in case of 10 other CCBs.
Small enterprises are the ones that invest up to Rs 5 crore in plant and machineries in case of manufacturing and processing units and up to Rs 2 crore in case of small service units. Small proprietorship businesses, partnership firms, HUF and unincorporated bodies will benefit from this move.
"This move will allow us to expand our lending business to the small entrepreneurs," WBSCB chairman Samir Ghosh told ET. In fact, Mr Ghosh was seeking a revision of the single borrower limit to Rs 1 crore.
During April-June 2007, banks in the state have collectively offered Rs 366 crore to SSIs, reflecting 12% of the annual disbursal target of Rs 3,000 crore. Cooperative banks, on the other hand, offered Rs 29 crore to SSI during the period, reflecting 14% of the annual target of Rs 200 crore. The revision of single borrower limits on loans to small entrepreneurs would help cooperative banks to achieve the target.
The move conforms to the state government's initiative to channelise more bank loans to the small and tiny sector. It has urged banks in the state to lend Rs 3,000 crore during 2007-08 to small scale industries. Out of this target, the cooperative banks, as a cluster, are supposed to offer Rs 200 crore worth of loans to SSIs.
Nabard has raised the single borrower limit on loans from West Bengal State Cooperative Bank (WBSCB) and 10 central cooperative banks (CCBs) to tiny entrepreneurs. While it has doubled the exposure limit to Rs 50 crore in case of WBSCB and Bankura District Central Cooperative Bank, it raised the limit to Rs 35 crore from Rs 25 crore in case of 10 other CCBs.
Small enterprises are the ones that invest up to Rs 5 crore in plant and machineries in case of manufacturing and processing units and up to Rs 2 crore in case of small service units. Small proprietorship businesses, partnership firms, HUF and unincorporated bodies will benefit from this move.
"This move will allow us to expand our lending business to the small entrepreneurs," WBSCB chairman Samir Ghosh told ET. In fact, Mr Ghosh was seeking a revision of the single borrower limit to Rs 1 crore.
During April-June 2007, banks in the state have collectively offered Rs 366 crore to SSIs, reflecting 12% of the annual disbursal target of Rs 3,000 crore. Cooperative banks, on the other hand, offered Rs 29 crore to SSI during the period, reflecting 14% of the annual target of Rs 200 crore. The revision of single borrower limits on loans to small entrepreneurs would help cooperative banks to achieve the target.
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