December , 2019
Allahabad Bank creates positive sentiments for MSMEs
15:18 pm

Ellora De

Allahabad Bank, one of the leading nationalised banks of the country, is observing MSME Sampark Abhiyan (MSME Outreach) since October 2019. This is in order to remove the bottlenecks for MSMEs (micro, small, and medium enterprises) in accessing credit. The programme aims to revitalise MSMEs affected by demand slowdown or by delay in recovery of receivables and help in their revival and rehabilitation. This facilitation would continue till the end of this financial year. In this drive, all the MSME accounts which are under stress will be considered for restructuring or additional funding assistance depending on the viability of the project and their cash flows. To be eligible for the scheme, the account should be ‘standard’ as on the cut-off date. Further, the aggregate exposure as on January 1, 2019, including non-fund facility for banks should not exceed `25 crore and the exercise should be completed by December 2019 but not later than March-2020.

A senior executive of the bank said that the primary intention of the ministry behind this campaign was to create a positive sentiment for the MSMEs. He also said, “There is a feeling that the banks have withdrawn from lending and therefore there is a credit crunch for the enterprises.  As the MSMEs are the largest employment generators and opportunity creators for the beginners, there is a need to create a positive sentiment among them regarding availability of bank credit. During the festive season, a lot of purchasing happens in the country. So credit from the bank will boost enterprises during this period thereby reviving consumer demand. We are also ready to fund NBFCs.”

The officer added, “The ministry has informed that more than ` 2 lakh crore lending during the month of October and November 2019 has been done by public sector banks either through direct assignments or through partial credit guarantee or through micro finance institutions (MFIs) and corporates for on-lending. Around 4000 to 5000 MSME accounts are facilitated by the Allahabad Bank till now.  The bank has sanctioned close to `2000 crore out of which `1350 crore has been disbursed through direct assignments or pool purchase of NBFCs. Apart from that, NBFCs direct term loan lending would be around `1500 to ` 2000 crore during these two months. We are also directly outreaching MSME clients through various campaigns at centres across the country.”

Another senior executive of the Allahabad Bank said, “MSMEs are important for economic development of any county and this initia-tive will help a faster turnaround and accelerate MSME growth.”

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