SIDBI signs MoU with Snapdeal
Small
Industries Development Bank of India (SIDBI) signed a Memorandum of
Understanding with Snapdeal, an e-commerce major in India, to provide financial
support to its MSME vendors. The MoU was signed by DrKshatrapatiShivaji, CMD,
SIDBI andShri Kunal Bahl, CEO, Snapdeal on July 14, 2015 at SIDBI
office in Mumbai.
E-commerce is the buzz word in the global as well
as domestic market. The MSMEs find e-commerce platforms like Snapdeal as a
promising ground for increasing their business opportunities. The e-commerce
sector in India has become 4 times its size, from $3.8 billion in 2009 to $17
billion in 2014, growing at a CAGR of 37%. The sector is expected to cross the
$ 100 billion mark within the next five years, contributing over 4% to India’s
GDP.
Small Industries Development Bank of
India (SIDBI), set up under an Act of Parliament, has been consistently
promoting, financing and developing the Micro, Small & Medium Enterprise
(MSME) sector since its inception on April 02, 1990.
SIDBI continued its business model aimed at addressing the financial
and non-financial gaps in the MSME eco-system. Some
niche financial gaps addressed by the Bank are equity / risk capital,
receivable finance, sustainable finance which includes energy efficiency (EE)/
clean production (CP) technology and services sector financing.
The FY
2015 was a significant milestone in the annals of SIDBI as it celebrated its
Silver Jubilee anniversary. Over this
period, SIDBI cumulatively provided financial assistance of `3.90 lakh crore to
MSME sector, thereby benefitting 346 lakh people in the sector.
Further, SIDBI’s promotional and developmental (P&D) support
spans over entrepreneurial development, skill development, advisory services, promoting youth entrepreneurship, cluster development, capacity
building of bankers and MSMEs, etc. These P & D support resulted in setting
up of more than 1 lakh units, mostly in rural areas and provided employment
opportunities to more than 2.25 lakh persons in the sector.
Over the
years, SIDBI has pioneered a number of innovative financial products and set up
new institutions to cater to the diverse credit and non-credit needs of
MSMEs. In its efforts to include larger
number of MSMEs in its fold, SIDBI tied up with a number of intermediaries to
increase its outreach. MoU with
e-commerce giant ‘Snapdeal’ is one such effort in this direction.
The
innovative financial products are growth capital / risk capital, receivable
financing / reverse factoring, energy efficiency financing, micro finance etc.
The niche institutions set up by SIDBI include SIDBI Venture Capital Ltd.
(SVCL) for providing venture capital, Credit Guarantee Fund Trust for Micro
& Small Enterprises (CGTMSE) for providing credit guarantee coverage to
collateral free/third party guarantee free loans upto Rs. 100 lakh extended by
Banks / FIs to micro and small enterprises, SMERA Rating Ltd. (SMERA) for
providing comprehensive, transparent and reliable rating of MSMEs, India SME
Technology Services Ltd (ISTSL) for providing technology advisory and
consultancy services and Micro Units Development & Refinance Agency (MUDRA)
for providing access to institutional finance to the unfunded.
Snapdeal
promoted by Shri KunalBahl along with
ShriRohitBansal, is one of the India’s most impactful digital commerce
ecosystem, that creates life changing experiences for buyers and sellers. Snapdeal, the largest online marketplace, has
got the widest assortment of 11 million+ products across 500+ diverse categories
from thousands of regional, national, and international brands and retailers.
With millions of users and around 150,000 sellers,
Snapdeal is fast becoming the shopping destination for internet users across
the country, delivering to 5000+ cities and towns in India.
With its acquisition of Freecharge in 2015, a
leading mobile transaction platform, Snapdeal has become the largest m-Commerce
company in the country. In its journey
till now, Snapdeal has partnered with several global investors and individuals
such as Softbank, Blackrock, Temasek and eBay Inc., Premji Invest, Intel
Capital, Ratan Tata, etc
For addressing the problem of lack of required financial assistance,
SIDBI and Snapdeal have joined hands to enable latter’s MSME vendors to scale
up their online business through financial support from SIDBI. On this occasion, Dr. Shivaji said that, this
MoU is a step towards “Make in India” campaign of Govt. of India.
To this end,
SIDBI has already set up a Rs. 1,000 crore Make in India Fund, which aims to
extend financial assistance to MSMEs at competitive rates.Through this partnership,Snapdeal and SIDBI
have agreed to work together for enabling MSME sellers / vendors of Snapdeal to
scale up their online business with easy access to financial assistance.
India’s growth presents immense growth
opportunities for small and medium sized businesses. Through this partnership with SIDBI, Snapdeal
will provide MSMEs, the necessary financial and non-financial support to help
expand their business and reach. India is a powerhouse of talent and resources and if channelised well,
these entrepreneurs in India have the caliber of being frontrunners in the
digital story of the country.
SIDBI would not only be facilitating financial
assistance but would also be working towards capacity building of these small
vendors by making them digitally empowered through its cluster interventions.
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