SIDBI eyes growth from small-ticket MSME loans
lending in the segment where the demand is for loans of up to ₹5 lakh, its chairman said.
The state-owned lender will press the pedal on its 'Prayaas Programme' that targets businesses that are looking for loans between ₹1 lakh and ₹5 lakh, which are not served by other established lenders such as banks and even non-banking finance companies in general.
«The development finance institution is ramping up the lending between ₹1 lakh to ₹5 lakh as this sector is underserved,» said SIDBI chairman S Ramann. «Total MSME credit in the country is about ₹24 lakh crore.
Another ₹25 lakh crore is needed in the next three years to satisfy the credit demand of MSMEs.»
State-run lenders and specialised institutions are accelerating lending to small and medium enterprises as the government looks to create more employment opportunities. The state and the regulator have designed multiple programmes to ensure that credit flows to the segment that serves millions.
While credit has been growing, it has not been to the desirable levels.
SIDBI looks to have a bigger share of the SME loan pie. «We want 25% of MSME borrowings to be on SIDBI's books», said Ramann.
Around 14% of the total outstanding MSME borrowings are on SIDBI's books and he expects it to rise to 15% soon.
