Friday

01


March , 2019
Syndicate Bank to earn Rs. 300 to Rs. 500 crore from its co-lending arrangement with Srei Equipment
13:44 pm

B.E. Bureau


Srei Equipment Finance Limited recently announced that it has partnered with Syndicate Bank to jointly provide equipment financing under co-lending arrangement for various equipment categories like construction, mining, material handling, commercial vehicles, medical and farm equipment. The partnership has been done under the aegis of the Reserve Bank of India’s circular dated September 21, 2018 that permits banks to engage with non-banking finance companies

(NBFCs) to co-originate loans for the creation of priority sector assets. Under this arrangement, Syndicate Bank will leverage its low cost of funds to co-originate and co-lend equipment loans with Srei Equipment at a mutually agreed ratio.

iQuippo, a Kanoria Foundation initiative, will facilitate sourcing of loans under this programme. iQuippo is India’s first and one-of-its-kind digital marketplace for construction equipment, machinery and services. The platform has been digitalising the fragmented construction equipment industry in India. iQuippo will aid both Srei Equipment and Syndicate Bank in further deepening their reach in CME and commercial vehicles segment.

Commenting on the programme, Sunil Kanoria, Vice Chairman, Srei said, “Innovative solutions are the need of the hour for NBFC space. At Srei, we have nearly three decades of unmatched experience. We are extremely positive that by bringing together our expertise with the strengths of Syndicate Bank, we will be able to cater to requirements of the fast growing infrastructure equipment industry and act as a catalyst in India’s economic growth.”

Anant Raj Kanoria, CEO, iQuippo, stated, “This is an important occasion for iQuippo as we bring on board Syndicate Bank as our partner for co-origination of loans. Our customers and stakeholders will benefit from the various services offered at the touch of a button. iQuippo’s platform would help institutions to access the SME and MSME market seamlessly and bring efficiency and transparency in the process. It would enable Syndicate Bank to gain access to a large set of customers in their geographies which they were not servicing and also allow them to cross sell products apart from lending through the platform.”

Syndicate Bank expects to garner a business of Rs. 300 to Rs. 500 crore in the next three months under this arrangement. Mrutyunjay Mahapatra, MD and CEO, Syndicate Bank, said, “The MSME sector constitutes an important aspect of the commercial value chain and ecosystem of the country.

Typically the origination, borrower identification and preliminary due diligence have of late been done better by specialist NBFCs in this segment. Syndicate Bank, as a strategy, is entering into a number of collaboration arrangements under RBI’s September 21, 2018 circular to benefit and synergise under the co-origination window. Under this arrangement there is a specified framework of responsibility sharing in various stages of the loan life cycle of MSME equipment financing. Srei Equipment shall be providing both origination and collection expertise while Syndicate Bank be primarily responsible for underwriting and funding.”

The bank is also working with other finance and technology companies in microfinance, supply chain finance and agri finance to enlarge the different tie-ups and engagements.

 

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