SIDBI Collaborates with NSE to Develop Debt Capital Platform for Firms in MSME Sector

The micro, small and medium enterprises are blooming in the country with various government and non-government agencies undertaking several schemes and programmes to increase the investment flow for the firms in the sector. Massive inflow of funds has also helped the sector to stay afloat in even as major business industries suffered and incurred losses owing to the economic slowdown induced by the lockdown imposed to curtail the spread the coronavirus. The MSME sector frayed pretty well in the COVID-19 era as well.

There are various initiatives by public and private sector banks offer equity-based finance to the micro, small and medium enterprises. Even the non-banking financial institutions have extended schemes to support the firms in the MSME sector. However, the need to develop to additional debt and equity instruments to create more financial solvency and soundness in the sector. It is important for the overall development of the sector- capital intensive and labour incentive both. Startups and MSMEs in India Get Major Boost As Indian Bank Signs MoU With SID of IISc for Extending Exclusive Credit Facility to Businesses.

Recently, the National Stock Exchange (NSE) entered into an agreement with the Small Industries Development Bank of India (SIDBI) to explore the feasibility of a debt capital platform for the micro, small and medium enterprises. "Keeping in view the large and diversified MSME sector in the country, there is a continuous need for various institutions to co-ordinate and co-operate with each other for the benefit of MSME sector," V Satya Venkata Rao, Deputy Managing Director of the Small Industries Development Bank of India told the reporters in this contest. MSMEs in Haryana Get Major Boost! Products Manufactured by MSMEs in the State To Get Global Market, Talented Artisans To Benefit.

Taking about the collaboration he said that both the institutions (NSE and SIDBI) run several programmes for the enterprises in the MSME sector, adding that the co-operation will help increase the impact and reach of these programmes. Rao also said that an expert committee on MSMEs, headed by U K Sinha, the former Chairman of Securities and Exchange Board of India (SEBI) has made several recommendations for the micro, small and medium enterprises, including the need to develop additional instruments for debt and equity, which will help crystallise new sources of funding for MSMEs.