Archives

Small Finance Banks

On 27 November 2014, RBI had released the guidelines on Small Finance Banks along with the Payment Banks. The objective of small finance banks is to further financial inclusion by providing: Basic banking facilities to the unbanked and thereby boosting saving habits. Supply of credit to small business units, small and marginal farmers, micro and […]

Trade Receivables Discounting System

Trade Receivables Discounting System or TReDS is a welcome step by RBI to secure finances for micro, small and medium enterprises. It has been set up under the regulatory framework set up by RBI under Payment and Settlement Systems Act 2007. Rationale MSMEs have always been at the receiving end of the wrath of the […]

Priority Sector Lending

Priority sector was first properly defined in 1972, after the National Credit Council emphasized that there should be a larger involvement of the commercial banks in the priority sector. The sector was then defined by Dr. K S Krishnaswamy Committee. Objective of Priority Sector Targets The overall objective of priority sector lending programme is to ensure that […]

Pradhan Mantri Mudra Yojana

Pradhan Mantri MUDRA Yojana has come as a boon for MSME (Micro, small and medium Enterprises) sector and is widely hailed as a robust measure to achieve inclusive growth. Objective of the Pradhan Mantri MUDRA Yojana There are a lots of Scheduled castes, scheduled tribes and other backward classes entrepreneurs in the MSME sector. NSSO Survey 2013 suggests […]

MUDRA Bank

In the Budget of 2015-16, the government proposed creation of a Micro Units Development Refinance Agency titled MUDRA Bank. Some of its features are as follows: The bank will be built with a corpus of Rs. 20,000 crores and a credit guarantee corpus of Rs. 3,000 crore. Mudra will refinance MFIs (microfinance institutions) through the […]

Re-vitalizing the MSMEs

What is the significance and contribution of MSMEs in Indian economic growth? What are hurdles to its development and the initiatives of GOI to revamp the industry?