MSMEs get lifeline at Fapcci's loan mela

Over 400 people including wannabe entrepreneurs make useA

of the industry body's unique initiative supported by HMTV

Hyderabad: The two-day mega loan mela organized by Fapcci for MSMEs created positive vibes among industrial community with over 400 entrepreneurs, both old and wannabes, thronging the venue to seek loans. Eight banks including SBH and Andhra Bank participated in the mela which attracted project proposals from diverse sectors such as pharma, IT, chemical and manufacturing segments. The event supported by HMTV concluded on Sunday. "Micro, small and medium enterprises (MSMEs) are backbone of the Indian economy as they generate most of the employment in the country. This mela has succeeded in bringing entrepreneurs and banks onto a single platform," V S Raju, past president, Federation of Andhra Pradesh Chambers of Commerce and Industry (Fapcci) told The Hans India. He further said the mela had been of immense help to those who wanted to become entrepreneurs. "The response has exceeded our expectations and close to 53 people visited our stall on the first day itself enquiring about loan opportunities and applying for loans. Over 16 people came in the morning of the second day. We explained about documents needed for loans," M Kamalakar Rao, Deputy General Manager, Hyderabad Zone-1, Andhra Bank. Andhra Bank had two stalls at the loan mela which also two private equity players. The premier public sector bank from the State which supported MSME sector throughout will finalise the loans within 15 days once all the requisite documents are submitted by the applicants. "We have received enquiries from both new and existing entrepreneurs. At zonal level, we are authorized to sanction up to Rs 25 crore, while loans for higher amounts will be forwarded to higher offices of the bank," he said. According to him, industries like rice mills which fall under SME category require loans up to Rs 100 crore. Lauding the Fapcci for taking up the initiative, S Murali, Assistant General Manager, Credit Centre, Secunderabad, SBH, said the bank set up two stalls at the event and both received good footfalls. The one he was supervising received 20 applications and interestingly, most of them were from wannabe entrepreneurs. "Besides pharma sector which has widespread base in Hyderabad, the enquiries were also from other sectors including manufacturing and services. We explained them about CGTMSE that facilitates lending up to Rs one crore to MSMEs without any collateral security," he said. SBH charges interest rate of 13.45 per cent for loans upto Rs 25 lakhs under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) and 13.70 per cent for normal loans. The loans more than Rs 25 lakh attract interest rates ranging from 12.45-14 per cent. However, some entrepreneurs complain that many banks are not willing to give collateral-free loans under CGTMSE. "I approached a bank for loan for setting up chemical plant which entails investment of Rs 70 lakh. Bank officials there asked me to either bring collateral for the loan or approach another bank," Madhav, a wannabe entrepreneur said. A software professional, he decided to chart out his own path by establishing a chemical factory that will make chemical product used in petroleum drillings. "I approached all the banks at the loan mela and their response has been encouraging. As zonal officials are present at the stalls, we will have to see what will happen when we approach branches that sanction the loan," he said. Encouraged by the response, Fapcci looks to make the event an annual affair. "This is first of its kind initiative here. Our objective is to provide an interactive platform for entrepreneurs and banks," says Hreemsudha S Shenoy Parkal, Banking Consultant, Fapcci.