| V K Chopra, chairman and managing director, Sidbi said, "We are in talks with the World Bank to raise about $200 million to fund small and medium enterprises at competitive rates." |
| Chopra told that the interest rate of the World Bank loan is still under negotiation. The loan will also include grant of support for allied activities. "We have requested the government to clearly define the norm of lending for medium enterprises and review the existing norm of lending to small enterprises," he added. |
| The present norms categorise advances up to Rs. 1 crore as advances to small enterprises. Advances up to Rs. 5 crore to the export segment is also considered as advances to small enterprises. |
| Under the collateral free guarantee scheme, Chopra said Sidbi had covered 13,500 small and medium enterprises (SME) units for about Rs 170 crore in the last one year which is expected to touch Rs 300 crore by the end of current fiscal. |
| Chopra said the credit offtake had been good for the last three months. He added that with the finance minister's recent comments on lending to SMEs must be below 2 per cent of the prevailing PLR is expected to further increase credit offtake. Previously, banks used to advance credit to SMEs at 2 per cent above and below PLR depending upon their credit worthiness. |
| Chopra pointed out though the collateral free guarantee scheme was launched in January 2001, awareness about the scheme among entrepreneurs and bankers was poor. Sidbi had been conducting seminars throughout the country. An estimated 6,500 SMEs, of 13,500 SME units were covered in the last six months. |
| Sidbi had sanctioned Rs 7,000 crore and about Rs 3,100 crore were disbursed during the current fiscal. The net worth of the bank was about Rs 4,000 crore for the nine months ending 31 December 2003. |
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