KTR asks banking fraternity to not invoke the provisions of Sarfesi Act. Asks them to conduct techno-economic viability study of units and try to rescue them
Hyderabad: The Telangana State Finance Corporation (TSFC), the state-owned non-banking financial company, will be willing to work with banking partners like the Indian Bank on setting up a revolving credit fund or a similar structure to support the micro enterprises that face issues with collaterals and margin money, said IT and Industries Minister KT Rama Rao.
“We would be happy to work together. Is there an innovative way for us to collaborate so that we can take care of these whole requests for collateral or the Government can offer some kind of revolving fund. If some mechanism can be evolved between TS and Indian Bank, I think that will be the first of its kind mechanism in the country. We can start slow and scale up as we progress,” he said.
Launching the MSME Prerana, a business mentoring programme for MSME entrepreneurs offered by Indian Bank, he said that MSMEs face issues with raising collateral, margin money and the Government would like to play a buffer in such instances to aid the MSMEs.
He appealed to the banking fraternity to not invoke the provisions of Sarfesi Act immediately after a company defaults on payments. This was leading to the closure of the units and this was not desirable. Instead, the banks should conduct a techno-economic viability assessment and lend the required support to bring the unit back to normalcy, the minister said.
In this direction, Telangana’s own Industrial Health Clinic has been working with SMES to understand the reasons for them to turn sick and take up the required measures together with the banks and financial institutions. This intervention was also saving the employment of members working in these units, KTR said quoting Chief Minister K Chandrashekar Rao that the vulnerable, and not the mighty, need the support of the institutions to toil over the hardships.
The State is making rapid progress in all spheres and this opens new opportunities for increasing the lending avenues, particularly for the MSMEs.
He lauded the role played by Indian Bank in development works like the Kaleshwaram Project and Mission Bhageerata. The Bank has been associated with works being taken up by TSGenco, TSRTC, Markfed and other agencies. He asked the Indian Bank to support some urban infrastructure projects as well.
The Minister requested Indian Bank Managing Director and Chief Executive Officer Padmaja Chunduru, subject to banking rules, to be a board member of We-Hub, the state supported incubator for women entrepreneurs.
Earlier, the Indian Bank MD, said the bank would soon look to get into an MoU with T-Hub to give working capital and equipment loans to units identified by the latter through its SpringBoard programme.
The new programme, MSME Prerana, is an online programme that will focus on teaching management and accountancy. The classes will be held on weekends, she said.
The course fee will be borne by Indian Bank and certificate of participation will also be given at completion of the course. It will be offered in Telugu, Urdu, Hindi and English. The Bank had already launched this in Tamil Nadu, UP and Maharashtra recently.
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