Fund of Funds likely to profit over 25 lakh MSMEs: Rajnish Kumar, SBI Chairman

The Fund of Funds for Rs. 50,000 crore equity infusion in MSMEs is to be operational soon and assures to profit over 25 lakh MSMEs. The fund was announced by the Finance Minister Nirmala Sitharaman in the economic package under Atma Nirbhar Bharat Abhiyan

State Bank of India Chairman Rajnish Kumar on Monday, informed the announcement of Fund of Funds to infuse Rs. 50,000, crores to assist the pandemic hit MSME’s sector by the Finance Minsiter Nirmala Sitharaman as a part of the Atmanirbhar Bharat during May’20 is probably going to be viable soon.

While addressing a virtual MSME Conclave coordinated by the FICCI Karnataka State Council, he added, One, the immediate help for improving the liquidity of MSMEs. Second, the MSME unit (if) in trouble then support by way of subordinated debt which is guaranteed by the government. Third, is Fund of Funds which he presumes will be operational very soon.

The fund set up with a corpus of Rs 10,000 crores later approved by the Central Cabinet in June apace with an amendment in the definition of MSMEs stand to benefit over 25 lakh MSMEs under stress,

Finance Minister Nirmala Sitharaman had publicised Rs 3.7 lakh crore stimulus package in May including the Rs. 3 lakh crore emergency credit scheme and Rs 20,000 crore subordinated debt for stressed MSMEs.

Welcoming SBI’s support towards MSMEs through the pandemic, Kumar said “As far as MSME lending is concerned, we are at the forefront. When COVID happened, SBI was the first bank that immediately on the same day announced COVID emergency credit line which became the model for all other banks to adopt. The key element for the COVID credit line was that the delegation of financial power was given to all our local functionaries so that there are no hassles.”

As of August 3, 2020, both public and private sector banks have disbursed over Rs 92k crore to over 21.78 lakh MSME accounts. Among the general public Sector Banks

SBI has disbursed 16K crore of the Rs 52k crore dispensed till date, nonetheless, Canara Bank has disbursed in 3.60 lakhs accounts and SBI in 3 lakh accounts.