VIA Economy & Finance Forum organised a session on “SIDBI new schemes of assistance for MSME” recently at VIA Auditorium on physical as well as virtual platforms.
Eminent speakers and Chief Guest of the session, Anjani Kumar Srivastava, General Manager of Small Industries Development Bank of India (SIDBI), Pune Region addressed the participants and shared his views on the potential & importance of this region and the developmental role which SIDBI can play.
He enthusiastically shared his experiences and exposure to customers from Nagpur. He briefed about SIDBI, which was set up in 1990 under an Act of Indian Parliament, acts as the Principal Financial Institution for Promotion, Financing and Development of the Micro, Small and Medium. He said SIDBI’s role is to facilitate and strengthen credit flow to MSMEs and address both financial and developmental gaps in the MSME eco-system Enterprise (MSME) sector as well as for coordination of functions of institutions engaged in similar activities.
He gave an overview of the various new schemes of SIDBI and talked about schemes like Arise, Sthapan, Ubharte Sitare and other activities of SIDBI for the MSME sector. He also discussed the Cluster scheme and the important role VIA & SIDBI can play in the cluster development in the region.
D Prasad Rao, Branch Manager of SIDBI, Nagpur Branch gave a presentation on “SIDBI new schemes of assistance for MSME” and also elaborated the ARISE Scheme, which planned incentive programs for units having an excellent repayment track record with SIDBI and timely implementation of the project.
He further said this is 100% financing for the purchase of machinery only is allowed for smaller loans up to Rs 3 crore and sectors under the scheme include Automobiles and Automobile Components Aerospace & Defense, Biotechnology, Chemicals and chemical products, Textile and Garments, Electronic systems, Electrical machinery, Drugs and Pharmaceuticals, Food Processing, Renewable Energy, etc. Interest rate 5.50% onwards, depends on internal rating.
STHAPAN Scheme is exclusively for assisting greenfield units in specified sectors like PLI, Medical equipment, A&D, Auto, Project funding including purchase of industrial plots, civil works, purchase of machinery, MFAs, etc. The incentive is given one-time grant support of Rs. 1 lakh or 0.1% of term loan outstanding, whichever is lower, shall be provided to a borrower provided they adhere to milestones set under terms of sanction.
Another Scheme “Ubharte Sitare Program is made for Small & mid-sized companies, who are engaged in sectors with high export potential like Auto & Auto Components, Aerospace & Defense, Capital Goods IT & ITES, Pharmaceuticals etc. This scheme is exclusively for expansion, modernisation, Diversification, R & D, Packaging etc.
Generally, Loans up to Rs 10 crore with 80% finance and joint financing with EXIM Bank if the loan requirement is more than Rs. 10 Crore. SMILE (SIDBI Make In India Soft Loan Fund for MSMEs) focuses the target customers on 25 Make In India sectors, Manufacturing as well as Service sector enterprises and Greenfield units are also eligible. He said the key attraction is a soft loan in the nature of quasi-equity available to meet DER and growth requirements; Interest rate @ 6.50% – 8.00% p.a. and repayment tenure generally up to 7 years.
He further informed about Working Capital Limit, which target Customers like existing customers solely banking with SIDBI, existing well-performing entities, who do not enjoy working capital facility & where term loan is considered by SIDBI & new entities where term loan is being sanctioned. He highlighted the Key Attractions, Eligibility criteria and other aspects.
He further elaborated other schemes ‘SPEED’ under which MSMEs are buying standard OEM machines with 100% Finance and 25% cash collateral and Interest rates-MCLR Linked. In another scheme – SPEED Plus, MSMEs buying standard high-end machines, 5 years vintage and turnover of Rs. 5 crores is required.
In PRATHAM, MSMEs buying machines with 3 years vintage, 100% Finance and 30%-35% cash collateral with interest rates MCLR Linked are available, he informed. Even SIDBI have a product of working capital in association with Yes Bank, IDBI Bank, etc., he informed the gathering.
He also shared success stories of successful entrepreneurs i.e. Simplex Chemopack, Akar Industry, Kinetic Gears, Glass Build Industry, who have been associated with SIDBI since the inception of their units.
Earlier, Suresh Rathi, President of VIA, in his welcome, Anjani Kumar Srivastava & D Prasad Rao by offering the floral bouquet. S S Muddamwar, General Manager of DIC was also present on the occasion and was welcomed by CA Girish Deodhar.
Suresh Rathi remarked about the recently celebrated “Vanijya Saptah” by VIA jointly with Central and State Governments for promoting exports from this region. He appreciated the efforts taken by the SIDBI for taking up the initiative for the development of the MSME sector of this region.
CA Naresh Jakhotia, Treasurer – VIA made an opening remark, introduced the guest speakers and moderated the Q&A session. He further said that SIDBI has a scheme that offers interest rates of 5.50% to 6.50% as well up to 3 Cr without any collateral. He also emphasized the importance of time in the processing of the loan proposal.
CA Sachin Jajodia gave the concluding remarks and formal vote of thanks. Members of the association, MSMEs, industrialists, professionals, entrepreneurs and interested persons attended the session at VIA as well as joined on virtual. Prominently present were Girish Deodhar, Dushyant Deshpande, Rakesh Khator from Lighthouse System, Nitin Agrawal, Jethalal Rukhiyana, Anup Bhalerao, Rishabh Chopra and others.