Rs 2000cr Budget booster for SIDBI to lend more to small units
Backed by a Rs 2,000-crore fund announced in the Union Budget for boosting credit flow to small and medium firms , the Small Industries Development Bank of India will strengthen its presence in industrial clusters.
By PTI |
NEW DELHI: Backed by a Rs 2,000-crore fund announced in the Union Budget for boosting credit flow to small and medium firms , the Small Industries Development Bank of India will strengthen its presence in industrial clusters.
"We will open branches in the industrial clusters of Kolapur in Maharashtra and Chindwara in Madhya Pradesh in the next one month," SIDBI Deputy Managing Director Rakesh Rewari told PTI.
SIDBI, which is not in the business of direct lending, extends funds to the Micro, Small and Medium Enterprises (MSMEs) through banks and other institutions. It has already opened branches in clusters of Alwar in Rajasthan, Trichi in Tamil Nadu and Kozhikode in Kerala.
A large chunk of India's 12.85 million small and tiny enterprises contributing 39 per cent to the country's manufacturing sector are housed in over 350 industrial clusters, many of which specialise in specific products.
Finance Minister P Chidambaram has proposed in the Budget for 2008-09 setting up of two funds of Rs 2,000 crore in SIDBI - one for risk capital financing and the other for enhancing refinance capability to the MSME sector.
Rewari said, SIDBI would be taking a major initiative to encourage entrepreneurs to avail of the collateral-free loan under the Credit Guarantee Scheme. Under the scheme, up to 80 per cent of the loan guarantee is given by the Centre.
"Over 90,000 units have already been given collateral- free loans" he said adding that SIDBI would seek increased credit from the public sector banks for the MSMEs.
Under the Credit Guarantee Fund Scheme, collateral-free credit up to Rs 50 lakh is available to MSMEs by lending institutions.
"We will open branches in the industrial clusters of Kolapur in Maharashtra and Chindwara in Madhya Pradesh in the next one month," SIDBI Deputy Managing Director Rakesh Rewari told PTI.
SIDBI, which is not in the business of direct lending, extends funds to the Micro, Small and Medium Enterprises (MSMEs) through banks and other institutions. It has already opened branches in clusters of Alwar in Rajasthan, Trichi in Tamil Nadu and Kozhikode in Kerala.
A large chunk of India's 12.85 million small and tiny enterprises contributing 39 per cent to the country's manufacturing sector are housed in over 350 industrial clusters, many of which specialise in specific products.
Finance Minister P Chidambaram has proposed in the Budget for 2008-09 setting up of two funds of Rs 2,000 crore in SIDBI - one for risk capital financing and the other for enhancing refinance capability to the MSME sector.
Rewari said, SIDBI would be taking a major initiative to encourage entrepreneurs to avail of the collateral-free loan under the Credit Guarantee Scheme. Under the scheme, up to 80 per cent of the loan guarantee is given by the Centre.
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"Over 90,000 units have already been given collateral- free loans" he said adding that SIDBI would seek increased credit from the public sector banks for the MSMEs.
Under the Credit Guarantee Fund Scheme, collateral-free credit up to Rs 50 lakh is available to MSMEs by lending institutions.
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