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Liquidity Support to MSMEs through NBFCs

Scheme for Special Liquidity Support to MSMEs through NBFCs

  • To provide liquidity support to MSMEs impacted due to COVID 19, through NBFCs including Fintech NBFCs. The scheme would provide resource support to NBFCs by way of term loans to ensure operational continuity and promote onward lending to MSME sector.
  • Registered with RBI as Investment and Credit Company (ICC)
  • In business for 3 years
  • Have Minimum Net Owned Funds of `20 Crore and Minimum Asset Size of `50 Crore;
  • Have external rating of BBB- or superior (as at March 31, 2020)
  • Be in compliance with applicable regulatory requirements
  • Promoter/Entity should not be in any RBI blacklist or defaulters list
  • Capital Adequacy ratio to be above RBI requirements, at all times in past 24 months
  • Facilities extended to MSMEs for bonafide business purposes
  • The loan shall be repaid in bullet instalment after 90 days from date of drawl or such date as may be decided by the bank
  • Need based security as per bank’s extant norms
  • 0.10% of sanctioned amount subject to maximum of `5 lakh alongwith applicable GST

Refinance Scheme for MSE to Liquidity Support

Special Refinance Scheme for MSE to provide Liquidity Support

  • To support the MSEs by facilitating flow of credit to this sector by ensuring sufficient liquidity in the hand of intermediary Financial Institutions
  • Scheduled commercial banks (Public, Private, Foreign) and Small Finance Banks (SFBs)
  • SIDBI's assistance will be available under the scheme to those scheduled banks having sizeable outstanding portfolio to MSEs/ micro credit and sound financials with following eligibility criteria:
  • FOR BANKS (other than SFBs)
    • In operation for a period of 3 years
    • Earned profit in atleast 2 out of last 3 years
    • Strong fundamentals based on last audited balance sheet viz
      (i)Net-worth of not less than ₹100 crore
      (ii)Capital to risk weighted assets (CRAR) of not less than 9%; and
      (iii) Level of Net NPAs not exceeding 10%
  • FOR SFBs
    • The SFB / previous entity prior to conversion into SFB (taken together) should have earned profits during at least 2 years out of the last 3 years and
    • Comply with the applicable benchmark norms for sanction
      i)Networth > or = ₹100 crore
      ii) CRAR >or =15%
      iii) Gross NPA < or = 7%
  • Eligible activities: As defined in section 2(h) of SIDBI Act
  • Units satisfying definition of micro & small enterprises as per Micro, Small and Medium Enterprises Development (MSMED) Act, 2006
  • Generally 90 days. In deserving cases could be extended longer (to be reset every 90 days linked to prevailing repo rate).
  • The Bank shall hold in trust for SIDBI, all the securities including movable and immovable assets, book debts, receivables, actionable claims, guarantees, assignments, bills of exchange and proceed thereof as also other securities as may be directly or indirectly obtained or to be obtained by the bank from its borrowers to secure the financial assistance made available to the borrowers for which the loan has been sanctioned by SIDBI to the bank

Liquidity Support to MSMEs through MFIs

Scheme for Special Liquidity Support to MSMEs through MFIs

  • To provide liquidity support to MSMEs impacted due to COVID 19, through MFIs. The scheme would provide resource support to MFIs by way of term loans to ensure operational continuity and promote onward lending to MSME sector
  • In operations for 3 years
  • Registered as Society, Trust, Company/ Section 8 Company, NBFC-MFIs, Co-operative Society and MACS;
  • Have external rating of BBB- or superior (as at March 31, 2020) and minimum MFI grading of “MfR5”;
  • Promoter / Entity should not be in RBI black list or defaulter list;
  • Capital Adequacy ratio not below RBI requirements, any time in past 24 months (applicable for NBFC-MFIs);
  • Comply with applicable regulatory guidelines
  • Facilities extended to microfinance borrowers / clients by the MFIs
  • The loan shall be repaid in bullet instalment after 90 days from date of drawl or such date as may be decided by the bank
  • Need based security as per bank’s extant norms
  • 0.10% of sanctioned amount subject to maximum of `5 lakh alongwith applicable GST