Institutional Finance
Institutional Finance to eligible Primary Lending Institutions (PLIs) such as Banks, Non-Banking Financial Companies (NBFCs) and Micro Finance Institutions (MFIs) for onward lending to MSMEs.
FINANCIAL ASSISTANCE TO BANKS
SYNOPSIS
Scheduled Banks are eligible for financial support by SIDBI under various refinance schemes.
Scheme details
- Micro and Small Enterprises Refinance Scheme (MSERS)
- Refinance Assistance to MSMEs for the Purpose of Export (RAMPE)
- Refinance Scheme for Micro and Small Enterprises (RMSE XIII)
- RMSE: “10-Year G-sec Yield” as on the last working day of previous quarter i.e., September 30, 2024, was 6.7497%
FAQs
ASSISTANCE TO NBFCS
SYNOPSIS
Non-Banking Financial Companies (NBFCs) registered with RBI as “ICC – Investment and Credit companies”, both Deposit taking and Non-Deposit taking, which are engaged in financing enterprises in the Micro and Small Enterprises are eligible for assistance.
Features
- Refinance Assistance from SIDBI to eligible Non-Banking Financial Companies (NBFCs), subject to meeting the prescribed norms.
Eligibility parameters for Scheme of Refinance to NBFCs (for NBFCs with external credit rating upto AA- )
Eligibility parameters for Scheme of Assistance to Emerging NBFCs (for NBFCs with external credit rating A+ to BBB-)
Eligibility parameters for Scheme of Developmental Assistance to NBFCs (for NBFCs with external credit rating below BBB-/ unrated)
MICRO LENDING DEVELOPMENT
MISSION & APPROACH
Mission: To create a national network of strong, viable and sustainable Microfinance Institutions (MFIs) for providing microfinance services to the economically disadvantaged people, especially women.Approach:Complete Range of Financial and Non-Financial Services- Financial Support to MFIs-
- Loan
- Capacity Building Grant
Milestone & Impacts
- Developed the capacity of 100+ MFIs
- Cumulative Sanctions: ₹30,090 cr
- Cumulative Disbursements: ₹27,327 cr
- Impacted more than 49.23 million beneficiaries
- SC/ST/ backward classes accounting for approx. 73% of the total beneficiaries.
- Women proportion was 96-98% among the beneficiaries.
- Brought out changes in the livelihood pattern by giving impetus to enterprise activity
National Microfinance Support Program (NMFSP)
- Launched in April 2000 under collaboration with Department for International Development (DFID), UK to bring in best microfinance practices in India. Collaboration was made with International Fund for Agricultural Development (IFAD), Rome in April-2002 for on lending support to MFIs.
Assistance to Small Finance Banks
- Out of 10 entities having received the SFB license from RBI, eight were partner MFIs of SIDBI
- Need based interventions to facilitate smooth transition from MFI to SFBs.
- Equity investment and resource support with provisions for conversion
Other Details
Documents/ Publications
- COCA reports
- Sectoral Studies
- Impact Assessment Studies
- SIDBI's Coffee Table Book You Tube Link: https://www.youtube.com/watch?v=UJZ-ongFhKQ&t=32s
RESPONSIBLE FINANCE INITIATIVES
KEY INITIATIVES
NBFC-ICC registered with RBI engaged in financing through loans to Micro and Small enterprises who are engaged in small businesses/ income generating activities.
- Capacity Building of MFIs
Adequate and customized package of Capacity Building grant to MFIs on the basis of Annual Capacity Building Need Assessment Exercise
- Transformation Loan to Scale up and Transform
Support to NGOs/ MFIs to transform from ‘non-profit’ to ‘for-profit’ i.e. Corporate Structure viz. Companies/ NBFCs. Introduced in 2004, proved one of the successful innovations by MLDD.
- Capacity Assessment Rating(CAR)
CAR pioneered by SIDBI in microfinance sector got wide recognition & acceptance in microfinance sector CAR now become a pre-requisite for getting assistance from Banks/FIs
- Creation of Portfolio Risk Fund
In collaboration with GoI, Portfolio Risk Fund launched to meet the security deposit requirement of the MFIs.
- Covered underserved pockets/ districts/ states (with emphasis on OBC, SC, ST, minority &women beneficiaries).
- Creation of Risk Fund
Fund created out of DFID grant support to expand micro lending operations to underserved regions of the country To address the concentration risk and the issue of regional
Lender’s forum
- Comprising key MFI Funders with a view to promoting cooperation and responsible lending practices among MFI lenders for leveraging support to MFIs across all the stakeholders.
Code of Conduct Assessment (COCA)
- COCA, a third party independent assessment of the status of compliance of an MFI with the Common Code of Conduct.
- COCA measures & MFI’s adherence to ethical and sound lending practices Developed, piloted and rolled out Harmonised COCA Tool (HCT). HCT of 36 MFIs have been hosted on SIDBI’s website.
India Microfinance Platform (IMFP)
- A MIX market database – meant to provide & disseminate valuable information on Indian MFIs.
- MFIs submit financial and operational data, at periodic intervals-enabling transparency
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