The Hindu Business Line : Cisco to fund enterprises through lease plan

Hyderabad June 14 Cisco has announced a new approach that enables enterprises to acquire technology through lease finance option. This is being funded through the Cisco arm, Cisco Capital that has a corpus of $150 million. Significantly, as opposed to interest rate of 12-13 per cent per annum this comes at aggressive seven per cent. In the process, helps slash overall Capex of small and medium-sized companies.

The Country Manager, Leasing, Cisco Capital India, Mr Gautam Munish, said, "As part of ongoing business initiatives, we have funded 18 companies in India and expect to reach out to about 250 enterprises during fiscal 2008."

Initially, Cisco offered these services directly through Cisco Capital, but now, others, including partners, would help deploy. This scheme is designed such that in less than two days, enterprises get necessary funding and could include related hardware and software. However, the leasing plan is restricted to non-competing products, Mr Munish explained.

Addressing a press conference here to announce this initiative in the country, Mr Munish said "Cisco Capital financing is available through partners for all Cisco products and services. The pay as-you-go option spreads between 12 and 36 months and extends funding up to Rs 80 lakh. Significantly, this protects against technology obsolescence."

This option is part of smart business road map and matches both short and long term goals with specific technology solutions.

Mr Munish said "for Cisco, India has emerged as a major destination prompting them to carve it out as Cisco Globalisation Centre East. This meant India is a second corporate headquarter for Cisco where some of the senior Cisco officials operate out of."

Risk issue

Asked about investment risk in such enterprises, Mr Munish said: "This has both upside and downside and the risk is quite spread out. With experience, at Cisco, we are able to analyse companies and their business plan and the exercise is aimed at enhancing customer experience. However, in the case of equity in terms of technology, one good investment could make a difference."

Cash flow

The Vice-President for Bio IT, Ocimum Bio Solutions, Mr Shravan K, said the Cisco solution helped them maximise cash flow while reducing the risk of obsolescence with the flexible option to upgrade.

In another case study, the Vice-President of Knoah Solutions, Mr Sridhar Sriramaneni, said: "Promptness in adapting to client needs could be the sole differentiator. Often it is difficult to take a call on allocation of funds for technology upgrades or meeting other business requirements. As a company with over 1200 people providing IT enabled services, Cisco support and association was a big differentiator bringing in nimbleness."