SIDBI - Small Industries Development Bank of India & its Functions
What is SIDBI?
SIDBI is better known as the Small Industries Development Bank of India. SIDBI is a bank that provides business loans to micro, small, and medium MSME businesses.
In Hindi, we know SIDBI as Small Industries Development Bank. SIDBI was established on 2 April 1990 as a subsidiary bank of the Industrial Development Bank of India (IDBI).
SIDBI Bank's headquarters is in Lucknow, the capital of Uttar Pradesh. Since 2015, the chairman of SIDBI, is Dr. Chattrapati Shivaji. SIDBI Bank has 15 regional offices and 100 branch offices across the country.
SIDBI provides small scale industries with the help of business loans through commercial banks, cooperative and regional rural banks, and state industrial finance corporations.
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What is The Main Function of SIDBI?
The main task of SIDBI is to provide financial assistance to micro and small industries in the country for their development.
SIDBI can also take loans in foreign currency from the Indian capital market and foreign institutions.
Let us tell you that just like IDBI, IFCI, IIBI industrial development banks, SIDBI has been entrusted with the responsibility of setting up, financing, development, etc. of micro and small scale industries.
SIDBI also provides financial assistance to small scale industries through commercial banks, cooperative and regional rural banks, and state industrial finance corporations.
The establishment of Small Industries Development Bank of India under an Act of Parliament on 2 April 1990, was done for the promotion, financing, and development of the Micro, Small, and Medium Enterprises (MSME) sector as well as the functions of entities engaged in similar activities.
Micro, Small, and Medium Enterprises (MSME) are included in the business sector of the Small Industries Development Bank (SIDBI). Along with that, all those small and medium industries are included in the field of SIDBI which contributes significantly to the national economy in terms of production, employment, and exports.
Micro, Small, and Medium Enterprises (MSME) is an important foundation of the country's economy in India. Because 5.1 crores micro, small and medium enterprise (MSME) units are operational in India. All these MSME units contribute significantly to India's economy and GDP.
SIDBI's contribution to the country is as follows:
About 11.7 crore jobs have been created through SIDBI.
With the cooperation of SIDBI, more than 6 thousand manufacturing units are built annually in the country.
SIDBI contributes 45% of the total production of the country.
SIDBI accounts for about 45% of manufacturing output (manufacturing output) of manufacturing units.
SIDBI contributes 37% to the GDP of the country.
Below is the record associated with SIDBI
SIDBI is ranked 30th among the world's development banks. The reason behind this is that 3260 trillion funds have been given by SIDBI to 32 million people as a business loan so far.
Some more institutions have been set up by SIDBI to provide financial assistance to the entrepreneurs. Following is the name of the institutions established by SIDBI:
Organization
Work
Micro Units Development and Refinance Agency (MUDRA)
Providing Mudra loans of up to 10 lakhs in three categories to MSME enterprises
Receivable Exchange of India Limited
(RXIL) The task of ensuring the repayment of loans given to MSME enterprises
Sidbi Venture Capital Limited (SVCL)
Work of providing working capital to MSME traders
Aquit Ratings & Research Ltd.
Work of providing credit rating of MSMEs
India SME Technology Services Limited (ISTSL)
Technology service and advisory work
India SME Asset Reconstruction Company Limited (ISARC)
Work to resolve NPA immediately
SIDBI supports Government of India initiatives related to the development of MSMEs and it also acts as the nodal agency for some government schemes like Mudra Loan Scheme, Make in India, and Start-up India
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Considering the importance and contribution of micro, small and medium enterprises in the country, NBFC, ZipLoan provides business loans of up to Rs 7.5 lakh to MSME enterprises without collateral security in just 3 days *.
Many MSMEs are not eligible to get business loans from other companies and banks because the eligibility criteria are very difficult from these banks from where the borrowers want to take a business loan.
To make sure that the businessmen are not deprived of business loans due to high eligibility criteria, ZipLoan has prescribed very easy eligibility for business loans. The eligibility is as follows:
The business should be more than two years old
The annual turnover of the business should be more than 10 lakhs
ITR filed annually for business should be more than 1.5 lakh
One of the places of business or home should be in the name of the businessman himself. (It is also valid in the name of self, in the name of parents, in the name of husband and wife, in the name of siblings, in the name of son and daughter.)
The list of paper documents that are sought is as follows:
Bank statement for the last 9 months. (Current bank account)
Copy of ITR filed last year
Copy of proof of ownership of any house or place of business. (It is also valid in the name of self, in the name of parents, in the name of husband and wife, in the name of siblings, in the name of son and daughter.)
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