SIDBI to launch VC fund for SSIs

The Small Industries Development Bank of India (SIDBI) plans to initiate a Rs 500 crore venture capital fund by September-end. It will incubate start up small-scale industries.

The planned fund will be set up in association with commercial banks. SIDBI chairman and managing director V K Chopra said on the sidelines of the FICCI conference on 'Global Banking: Paradigm Shift', that the proposed fund already has firm commitments of Rs 100 crore each from SIDBI and Punjab National Bank.

He added: "We are talking to more banks for commitments and expect the entire Rs 500 crore corpus to be inplace within the next two months." For the moment though, he said, SIDBI has on its own approved Rs 484 crore-worth venture funding for projects by small and medium enterprises.

"We have not supported the projects in terms of angel funding, but only financed expansion of existing ventures," he added.

Outlining SIDBI's other initiatives he said, SIDBI will also set up a credit rating agency, risk-sharing fund and a tech bank. The credit rating agency will be operational by the end of the fiscal, for dedicated assessment of companies in small-scale sector, he said.