The National Small Industries Corporation (NSIC) has stated that it is in the final stages of signing an agreement with State Bank of India (SBI) that will enable easy and affordable loans for small and medium-sized firms. NSIC, a mini-ratna firm under the Ministry of Micro, Small and Medium Enterprises (MSME), has been providing short term financial support to these enterprises by borrowing funds from banks and financial institutions. As part of the deal, NSIC is looking at an arrangement under which SBI will provide loans at affordable rates for MSMEs registered with it. The current rates at which firms in the MSME sector borrow from lenders range from 10 to 10.5 per cent.
NSIC Chairman cum Managing Director H P Kumar said apart from higher rates, MSME sector faced credit crunch as they could not meet collateral requirements and have limited access to equity capital. Kumar said NSIC is looking to import petrochemicals from Gulf nations and Latin American countries like Venezuela to cater to the needs of the industry. At present, there are about 26 million enterprises, which provide employment to almost 60 million people in the MSME sector.
