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The Small and Medium Enterprises want banks to do more by giving faster access to growth capital even as they are keen to embrace technology for good returns

The Small and Medium Enterprises want banks to do more by giving faster access to growth capital even as they are keen

to embrace technology for good returns

These are hectic times for small and medium enterprises in India. Recovering fast from the economic slowdown, they are busy chalking out strategies that would help them take a quantum leap into the future bringing them new orders, new markets and more revenue. Despite support from the government, there are several pain points that the SMEs have to deal with. Besides the challenges relating to hiring talent and drawing effective marketing strategies, it is the pain of raising growth capital and deploying technology that keeps SMEs occupied most of time. This leaves little time for them to focus on core business activities. Keeping these issues in mind, DARE in association with ICICI Bank and Cisco, organized the SME Knowledge Forums in Delhi, Kolkata and Nagpur. These events were part of a series of events that were organized in several other cities and were targeted at specific industry clusters.

 

 

In Delhi, the Knowledge Forum was targeted at Infrastructure sector with a host of issues relating to SME finance were discussed by the panel, which constituted Ved Khurana, State Coordinator, Builders Association of India (BAI); Rajiv Panthary, Assistant General Manager & Zonal Sales Head – SME North SMEAG, ICICI Bank; and Anurag Krishna, Territory Market Magager –North SMB, Cisco. Vimarsh Bajpai, Sr Assistant Editor, DARE, moderated the panel discussion. Khurana pointed out as to how the banks should take a more pro-active approach while lending to SMEs. He cited examples of how sometimes it becomes difficult to convince the bank about their repayment capacity. The discussion saw participation from the member of the audience who cited that while banks did help in some cases, many a times, the sanctioning of loans gets delayed and eventually the purpose of raising growth capital gets defeated. Panthary of ICICI Bank said that banks need to asses the risk involved before deciding to lend as they are answerable to their shareholders and cannot blindly grant loans without properly assessing the credit history of the borrowers. On the technology front, Khurana said that SMEs must adopt technology and see it as an enabler but the recurring costs of deployment of networking solutions was what holding them back from spending more on technology. To this, Krishna said that many SMEs feel the pinch of technology because they still see it as cost and not as a vehicle for growth. He said the availability of trained manpower was not the issue anymore, all that SMEs need is to understand the big boon that technology is to them.

In Kolkata, the engineering companies that gathered for the event was a mix of small and mid-size enterprises that are looking to expand over the years. The enthusiasm at the event was evident from volley of questions that were asked from the panelists. The panel here included Neeraj Mishra, Director, Bharat Bhari Udyog Nigam Limited; Satrajit Banerjee, Assistant Director, Engineering Exports Promotion Council (EEPC); Subhrajit Mitra, Assistant General Manager and Zonal Head (East), SME and Corporate Agri Group ICICI Bank; and Manoj Kumar Tiwari, Territory Marketing Manager, Cisco. Many of SMEs here are keen to target newer markets of South America and expressed the willingness to jump on to the EEPC bandwagon. On finance, they expressed concern regarding the interest rates that they claimed were higher that those charged from large enterprises. On technology, many of the engineering units are making fresh provisions in their budgets to include spends on networking solutions.

At the SME Knowledge Forum in Nagpur, it was a mix of companies from sectors such as infrastructure, manufacturing and power. Those on the panel included Pravin Tapadia, President, Vidarbha Industries Association (VIA), Abhay Garde, Maharashtra State Chairman of Builders Association of India; and Pravin Trivedi, Zonal Head West for SME-AG Group of ICICI Bank. The discussion led to Tapadia seeking more action from the banks in lending to SMEs. He sought greater cooperation from banks in easing the norms for lending. Trivedi said the banks were sensitive to the needs of the SMEs but insisted that transparency on part of the SMEs was an absolute must for banks to have enough confidence in lending. Garde cited that the construction sector was being meted out a step-motherly treatment by banks and that they needed to develop a better relationship with SMEs to understand their pain areas.

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