Business

How is the banking sector supporting MSMEs?

Written by rohitkakkar12

The MSME is a crucial sector in the Indian economy. However, micro, small and medium enterprises need funds to set up or grow. Thankfully, the Indian government and the banking sector understand the essence of MSME credit and have come forward through various schemes to grant loans to the sector. After the impact of Covid-19, the role of the banking sector has increased even more than before. Some of the loan schemes that various banking players offer are:

–        MUDRA (Micro Units Development and Refinance Agency Limited) is an NBFC offering a loan to non-corporate and non-farm enterprises in the sector. Under the Pradhan Mantri Mudra Yojana, there are three schemes – Shishu, Kishor, and Tarun to micro-units.

–        The Khadi and Village Industries Commission (KVIC) offers support in self-employment opportunities to artisans in the non-farm sector through the PM’s Employment Generation Programme (PMEGP).

–     The Ministry of Finance established the Small Industries Development Bank of India (SIDBI) to offer financial support to the MSME sector in 1990. The Reserve Bank of India regulates its work.

–      Yes MSME is a program launched by Yes Bank to offer loans to the sector. Besides, the program also offers operational and financial solutions with the help of specialists like Clear Tax and ZOHO to MSMEs.

–      The Ministry of MSME and SIDBI set up a Credit Guarantee Trust Fund for MSMEs to implement a credit guarantee scheme for the sector. The scheme offers loans to the sector without any 3rd party collaterals.

–        Twelve state-owned banks like SIDBI, SBI, PNB, BoB, BOI, NABARD, TIIC,  SBBJ, Corporation Bank, Indian Bank, and Canara Bank offer subsidies to the MSME sector technology upgradation under the Credit Linked Capital Subsidy (CLCSS) scheme.

Besides the above schemes, different banks offer loans to MSME units without collaterals. Mr.Rohit Kakkar, MD of VSRC Agro Products, has played a crucial role in highlighting issues being faced by the sector during the pandemic and now after the lockdown has been lifted. He feels that the banking sector can do a lot more to support MSMEs during these challenging times.

The MSME is a crucial sector in the Indian economy. However, micro, small and medium enterprises need funds to set up or grow. Thankfully, the Indian government and the banking sector understand the essence of MSME credit and have come forward through various schemes to grant loans to the sector. After the impact of Covid-19, the role of the banking sector has increased even more than before. Some of the loan schemes that various banking players offer are:

–        MUDRA (Micro Units Development and Refinance Agency Limited) is an NBFC offering a loan to non-corporate and non-farm enterprises in the sector. Under the Pradhan Mantri Mudra Yojana, there are three schemes – Shishu, Kishor, and Tarun to micro-units.

–        The Khadi and Village Industries Commission (KVIC) offers support in self-employment opportunities to artisans in the non-farm sector through the PM’s Employment Generation Programme (PMEGP).

–     The Ministry of Finance established the Small Industries Development Bank of India (SIDBI) to offer financial support to the MSME sector in 1990. The Reserve Bank of India regulates its work.

–      Yes MSME is a program launched by Yes Bank to offer loans to the sector. Besides, the program also offers operational and financial solutions with the help of specialists like Clear Tax and ZOHO to MSMEs.

–      The Ministry of MSME and SIDBI set up a Credit Guarantee Trust Fund for MSMEs to implement a credit guarantee scheme for the sector. The scheme offers loans to the sector without any 3rd party collaterals.

–        Twelve state-owned banks like SIDBI, SBI, PNB, BoB, BOI, NABARD, TIIC,  SBBJ, Corporation Bank, Indian Bank, and Canara Bank offer subsidies to the MSME sector technology upgradation under the Credit Linked Capital Subsidy (CLCSS) scheme.

Besides the above schemes, different banks offer loans to MSME units without collaterals. Mr.Rohit Kakkar, MD of VSRC Agro Products, has played a crucial role in highlighting issues being faced by the sector during the pandemic and now after the lockdown has been lifted. He feels that the banking sector can do a lot more to support MSMEs during these challenging times.

Original Source: Blogger.com

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