L7

SIDBI, IDBI and EX-IM Bank

 Learning outcomes
• Exposure with SIDBI Functions
• Evaluating SIDBI contribution in the growth of
the country
 SIDBI news
• https://www.sidbi.in/en/news
 Video
• https://www.youtube.com/watch?v=tJJJl7yOr
M8
Small Industries Development Bank of India
(SIDBI)
• https://www.sidbi.in/
 Evolution
• SIDBI has been set up on April 02nd, 1990 under an Act
of Indian Parliament. Being the Principal FI for MSMEs,
SIDBI has dedicated its resources towards evolution of a
vibrant MSME ecosystem

• SIDBI’s initiatives are aligned to the national goals of

a. poverty alleviation,
b. employment generation,
c. kindling entrepreneurship and
d. fostering competitiveness in MSME sector
 Cont…
• SIDBI is one of the four All India Financial
Institutions regulated and supervised by the
Reserve Bank

• State Bank of India is the largest individual

shareholder of SIDBI with holding of 16.73%
shares, followed by Government of India and
Life Insurance Corporation of India
 MCQs
• SIDBI has been set up on April 02nd, 1990
under an Act of
A. RBI
B. Indian Parliament
C. Industrial Ministry
D. None
 Mission and vision
MISSION
• To facilitate and strengthen credit flow to MSMEs and
address both financial and developmental gaps in the
MSME eco-system
VISION
• To emerge as a single window for meeting the financial
and developmental needs of the MSME sector to make it
strong, vibrant and globally competitive, to position SIDBI
Brand as the preferred and customer - friendly institution
and for enhancement of share - holder wealth and highest
corporate values through modern technology platform
 SIDBI’s key initiatives
https://www.sidbi.in/en/about-sidbi

• Providing a cumulative assistance of around INR 5.40 lakh crore channelized into the
MSME segment.
• Directly impacting over 360 lakh persons/enterprises through its branch network of
around 80 offices spread across the country as well as through the network of banks /
institutions (having more than 1.25 lakh branches) across the country.
• Extending loans, equity and quasi-equity aggregating to INR 13,689 crore benefitting 356
lakh disadvantaged people, mostly women, through its Micro Finance operations.
• Deepening its outreach by nurturing and evolving more than 100 MFIs who have emerged
as strong and viable financial intermediaries serving the unserved.
• Supporting more than 1.16 lakh budding and existing entrepreneurs by infusing skills and
reskilling initiatives.
• Facilitating Institutions Building by adopting a SIDBI Plus approach and creating its
Subsidiary and Associate Institutions for providing impetus to the growth of MSME
ecosystem.
• Developing a passionate pool of 1000+ professionals with 22% women and 40% belonging
to SC/ST and OBCs category, for serving to the needs of the dynamic and consistently
evolving MSME Sector.
 Functions of SIDBI
• Development
• Promotion
• Coordination
• Financing
 MCQs
Functions of SIDBI does not include:
a. Development
b. Promotion
c.Co-operation
d.Financing
 Functions Cont…Direct Loans
• SMILE (SIDBI Make in India Soft Loan Fund for MSME): Financial
requirements for new enterprises which are in the manufacturing or in
the services sector. The loan amount offered under this scheme is
minimum Rs. 10 lakh for equipment finance and Rs. 25 lakh for other
purposes. Repayment tenure is maximum of 10 years, including
moratorium period of up to 36 months
• SMILE Equipment Finance (SEF): purchase any new equipment or need
financing for the same are covered under this loan scheme. Repayment
period is of 72 months and the loan amount starts from Rs. 10 lakh
• Loans under Partnership with OEM (Original Equipment
Manufacturer): This loan scheme is helpful for MSMEs that can
purchase machines from OEMs. Minimum 3 years of business existence
is required and the repayment period is of 60 months. Loan amount
offered is maximum up to Rs. 1 crore
 Cont…
• Working Capital (Cash Credit): Working Capital is available for MSME
units. Working Capital offers seamless approvals, as per the loan
applicant’s requirement
• SIDBI Trader Finance Scheme (STFS): STFS loan scheme is for MSME
Retails/Wholesalers who are in existence for at least 3 years with a
satisfactory financial position. The minimum loan amount offered is Rs.
10 lakh and maximum up to Rs. 1 crore. However, the repayment period
shall depend on the cash flow and size of business
• Loan for Purchase of Equipment for Enterprise’s Development
(SPEED): Under this loan scheme, SIDBI offers 100% financing with loan
amount up to Rs. 1 crore for New to Bank and Rs. 2 crore for existing
customers. Minimum 3 years of operations are required to get this loan
wherein the repayment period is 2 to 5 years. Borrowers can avail this
loan at an interest rate of 9.25% to 10% per annum
 SIDBI’s Venture Capital

• Start-ups Lifecycle along with SIDBI’s

interventions
• Funds of Funds for Start-ups
• Aspire Fund-financial backing to start-ups who
are in the initial stages of setting up
manufacturing and services
• India Aspiration Fund-promote equity and
equity based investments in start-ups and the
MSME sector
 SIDBI’s Indirect Finance

• Assistance through Banks, NBFCs, and SFBs: Indirect Finance is provided to

Banks, NBFCs, SFBs and MSMEs

• Assistance to NBFCs: NBFCs which include the loan companies as well that are
registered with RBI help in providing financial assistance to enterprises in the
MSME sector

• Refinance Schemes: Assistance is provided to banks that are financially stable

through the refinance schemes

• Assistance to Small Finance Banks (SFBs): In order to strengthen the SFBs

equity and resource base, this scheme was introduced. This scheme focuses
on providing refinance support to SFBs
 Micro-Lending

• Micro-Lending Development: The mission of Micro-

Lending Development is to create an institution and
provide micro financial services to the people who are
economically weak, including women
• Responsible Finance Initiatives:In the light to promote
cooperation and the right lending practices in the financial
sector, this loan scheme comes as a big support to the
banks and other financial institutions in the country
• Beyond Microfinance: This loan scheme helps the
entrepreneurs to graduate from micro finance to a higher
ticket size at an affordable rate
 SIDBI plans access
• https://www.udyamimitra.in/
 IDBI Video
• https://www.youtube.com/watch?v=PdFP8dK
4caA
 IDBI https://www.idbibank.in/index.asp

• IDBI was established in 1964 under an Act of

Parliament as a wholly owned subsidiary of
the Reserve Bank of India.
• In 1976, the ownership of IDBI was transferred
to the Government of India and it was made
the principal financial institution for
coordinating the activities of institutions
engaged in financing, promoting and
developing industry in India.
 Cont...
• September 2004, the Reserve Bank of
India incorporated IDBI as a 'scheduled bank'
under the RBI Act, 1934.

• Consequently, IDBI, formally entered the

portals of banking business as IDBI Ltd. from 1
October 2004. The commercial banking arm,
IDBI BANK, was merged into IDBI in 2005.
 Cont...
• IDBI, formally entered the portals of banking
business as IDBI Ltd.
A. 2004
B. 2005
C. 2006
D. None
 Cont...
• Initially it operated as a subsidiary of Reserve Bank of India and
later RBI has transferred it to Government of India.

• On June 29, 2018 Life Insurance Corporation of India (LIC) has got a
technical go-ahead from Insurance Regulatory and Development
Authority of India (IRDAI) to increase stake in IDBI Bank up to
51%. LIC completed acquisition of 51% controlling stake on January
21, 2019 making it the majority shareholder of the IDBI Bank.

• Reserve Bank of India has clarified vide a Press Release dated

March 14, 2019, that IDBI Bank stands re-categorized as a Private
Sector Bank for regulatory purposes with effect from January 21,
2019.
 Functions of IDBI
(i) To provide financial assistance to industrial
enterprises.
(ii) To promote institutions engaged in industrial
development.
(iii) To provide technical and administrative
assistance for promotion management or
expansion of industry.
(iv) All commercial banking activities
 Video
• https://www.youtube.com/watch?v=uInwPzW
D6A4

• https://www.youtube.com/watch?v=5Ct7Ea_z
mSU
 EXIM Bank
https://www.eximbankindia.in/
• A specialized financial institution wholly
owned by the Government of India with
presence in Indian and foreign cities around
the world.
• Set up in 1982, for the purpose of financing,
facilitating and promoting India’s international
trade.
 Products and services
• https://www.eximbankindia.in/financial-produ
cts

• https://www.eximbankindia.in/services
 Thanks

Any Doubts
 Test yourself
• How can I apply for the funds in SIDBI?
• What is the procedure of EX-IM getting
financing?
• How IDBI products and services are different
from other banks?