Small Industries Development Bank of India or SIDBI was brought into operations on 2nd April 1990 under the act of the Indian Parliament to promote and uplift the Micro, Small and Medium Enterprises (MSME) sector. Reserve Bank of India is the regulatory for SIDBI. SIDBI assists the other financial institutions like small finance banks, non-banking financial institutions and other banks in providing the loans to the MSME industrial sector. This guide by H&R Block covers the functioning of SIDBI and the process for applying for a loan through the same.
SIDBI was formed under the Department of Financial Services, Ministry of Commerce, and Government of India. For the Financial Year 2017-18, the advances given by SIDBI is approximately Rs 95,300 Cr. which has risen by around 40% as compared to Financial Year 2016-17. The gross non-performing assets were reduced by 0.9%, and the net non-performing assets were reduced by 0.25%.
The objectives of SIDBI are:
The functions of SIDBI are:
There are a lot of benefits of SIDBI, which is why the government introduced decided to introduce and implement it. These benefits include:
There are two types of assistance provided to the MSME Sector, namely financial and non-financial assistance.
Following are the types of financial assistance provided to the MSME Sector:
Following are the types of non-financial assistance provided to the MSME Sector:
Providing consultation services and creating awareness amongst the MSMEs is also a step taken up by the government to obtain the final result. Some of these services consisted of the following:
Following are the steps required to get a loan sanctioned from SIDBI:
SIDBI is the perfect financial solution to the upcoming and existent Micro Small and Medium Scale Enterprises for their growth and expansion in the domestic as well as international market. SIDBI not only provides finance to these industries but it also assists business doing to boost the manufacturing sector of the nation which is responsible for its economic growth.
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