Securing finance has always been a challenge for MSMEs (micro, small and medium enterprises). Post Covid-19, things have become ever more complicated. To help MSMEs access funds easily, Chennai-headquartered Indian Bank has launched new products and, more importantly, simplified procedures in accessing them.

The three new products will help them meet their requirements in terms of working capital. The schemes include Covid emergency loan, reassessment of working capital loan, and guaranteed emergency credit line.

“Both manufacturing and service sectors need this emergency loan to improve their working capital. These facilities may be utilised quickly and MSMEs can restart their business. Also, we have simplified the procedure of appraisal and sanctioning powers given to field level functionaries to ensure quick disbursements,” MK Bhattacharya, Executive Director of Indian Bank, told BusinessLine.

The bank has shortened application forms and appraisal notes while taking digital routes for approvals for registered customers. It has also told the branches to study the loan request in some detail instead of blatantly rejecting the same. The headquarters is also using social media for monitoring and to respond to the issues of customers.

“In this unprecedented situation, mobility, which is required for documentation/ execution of loan documents and disbursements, is restricted. Though we took digital mode to address this issue, a majority rely on physical presence at branches,” he said.

Indian Bank’s MSME portfolio stands at ₹62,035 crore, and the bank has a strong presence in most of the MSME clusters in Tamil Nadu. “Now we plan to target MSME clusters in Gujarat and NCR regions,” he said.

The bank’s Government Guaranteed Emergency Credit Loans scheme extends finance of up to 20 per cent of the balance outstanding as on February 29to MSMEs, other business enterprises, and Mudra borrowers.

Apart from this, Indian Bank supports MSMEs through NBFCs and MFIs by way of direct credit for on-lending to MSMEs, purchase of pool of accounts by way of direct assignment, via Partial Credit Guarantee Scheme, and by funding out of TLTRO funds available with the bank.

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