governament support to entrepreneurship in india

7/30/2019 Governament Support to Entrepreneurship in India

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Government support to

entrepreneurship in

India:Institutional support from commercial banks, SIDBI,

NSIC, SFCs etc. Role of DICs and SISI in providingtechnical services.

MODULE-4


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INSTITUTIONAL SUPPORT FROM

COMMERCIAL BANKS


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Commercial banking is also known as business banking. It is a bank that

provides checking accounts, savings accounts, and money market

accounts and that accepts time deposits.

Commercial Banks in India are broadly categorized into Scheduled

Commercial Banks and Unscheduled Commercial Banks.

Scheduled Banks in India constitute those banks which have beenincluded in the Second Schedule of Reserve Bank of India(RBI) Act, 1934.

RBI in turn includes only those banks in this schedule which satisfy the

criteria laid down vide section 42 (6) (a) of the Act.

As on 30th June, 1999, there were 300 scheduled banks in India having a

total network of 64,918 branches.The scheduled commercial banks in

India comprise of State bank of India and its associates (8), nationalised

banks (19), foreign banks (45), private sector banks (32), co-operative

banks and regional rural banks.


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An entrepreneur requires a continuous flow of funds not only for

setting up of his/ her business, but also for successful operation

as well as regular up gradation/ modernization of the industrial

unit. To meet this requirement, the Government (both at the

Central and State level) has been undertaking several steps like

setting up of banks and financial institutions; formulating various

policies and schemes, etc. All such measures are specifically

focussed towards the promotion and development of small andmedium enterprises.

The public sector banks are the major source of financial

assistance to the industrial sector. They extend credit support tothe firms in the form of loans, advances, discounting bills,

project financing, term loans, export finance, etc. Some of the

major examples of such banks are:


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State Bank of India (SBI)

provides a wide range of financial products and services that cancater to any business or market requirement. It deploys multiplechannels to deliver integrated solutions for all financial challenges

faced by the corporate universe. Its various funding schemes are:-

Working capital finance, extended to all segments of industries andservices sector.

Corporate term loans to support capital expenditures for settingup new ventures as also for expansion, renovation, etc.

Deferred payment guarantees to support purchase of capital

equipments.

Project finance

Structured Finance
http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/viewsection.jsp?id=0,5,54,193http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/viewsection.jsp?id=0,5,54,193http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/viewsection.jsp?id=0,5,54,193http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/viewsection.jsp?id=0,5,54,193http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/viewsection.jsp?id=0,5,54,193http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/viewsection.jsp?id=0,5,54,193http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/viewsection.jsp?id=0,5,54,193http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/viewsection.jsp?id=0,5,54,193http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/viewsection.jsp?id=0,5,54,193http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/viewsection.jsp?id=0,5,54,193http://business.gov.in/outerwin.php?id=http://www.sbi.co.in/


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SBI:The bank also provides financial assistance to

agriculturists through a network of rural and semi-urbanbranches. These specialized branches have been set up in

different parts of the country exclusively for the

development of agriculture through credit deployment.

Their schemes cover a wide range of agricultural activitieslike crop loan, finance to horticulture, farm

mechanization schemes, land development schemes,

minor irrigation projects, agricultural term loans, etc.
http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,148http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,426http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,154http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,154http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,152http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,153http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,151http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,151http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,151http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,151http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,151http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,151http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,153http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,153http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,153http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,153http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,153http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,152http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,152http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,152http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,152http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,152http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,154http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,154http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,154http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,154http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,154http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,426http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,426http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,426http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,426http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,426http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,148http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,148http://business.gov.in/outerwin.php?id=http://www.statebankofindia.com/viewsection.jsp?lang=0&id=0,8,66,148


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Bank of Barodaoffers various products andservices that meet the specific requirements of

business enterprises, particularly the small scale units.Various schemes relating to the provision of loans and

advances by the bank include:-

Working Capital Finance

Term Finance

Small and Medium Enterprise (SME) Loan Pack

Small Business Borrowers

Traders Loan
http://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/http://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/bbs/workcapfinance.asphttp://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/bbs/termfinance.asphttp://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/bbs/sme.asphttp://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/bbs/profscheme.asphttp://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/bbs/bobvyapar.asphttp://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/bbs/bobvyapar.asphttp://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/bbs/profscheme.asphttp://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/bbs/sme.asphttp://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/bbs/termfinance.asphttp://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/bbs/workcapfinance.asphttp://business.gov.in/outerwin.php?id=http://www.bankofbaroda.com/http://business.gov.in/outerwin.php?id=http://www.andhrabank.in/


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Andhra Bankhas also devised a host of loan schemesto meet the financial requirements of an enterprise. Theseparticularly cater to the corporate and agricultural sector.Some of its important funding options include:-

Working Capital Loans

Export & Import Finance

Advance against Shares

Term Finance

Corporate Loans

Project Finance

Infrastructure Project Finance

Kisan Vikas Card

Kisan Sampathi

Self Help Groups-Bank Linkage Programme

Kisan Green Card
http://business.gov.in/outerwin.php?id=http://www.andhrabank.in/http://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/WorkingCapitalLoans.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/ExportAndImportFinance.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/AdvanceagainstShares.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/TermFinance.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/CorporateLoans.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/ProjectFinance.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/InfrastructureProjectFinance.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/ABKisanVikasCard.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/KisanSampathi.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/SelfHelpGroups.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/AndhraBankKisanGreenCard.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/AndhraBankKisanGreenCard.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/AndhraBankKisanGreenCard.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/AndhraBankKisanGreenCard.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/SelfHelpGroups.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/SelfHelpGroups.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/SelfHelpGroups.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/SelfHelpGroups.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/KisanSampathi.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/KisanSampathi.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/KisanSampathi.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/KisanSampathi.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/ABKisanVikasCard.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/ABKisanVikasCard.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/ABKisanVikasCard.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/ABKisanVikasCard.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/ABKisanVikasCard.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/InfrastructureProjectFinance.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/ProjectFinance.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/CorporateLoans.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/TermFinance.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/AdvanceagainstShares.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/ExportAndImportFinance.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/scripts/WorkingCapitalLoans.aspxhttp://business.gov.in/outerwin.php?id=http://www.andhrabank.in/


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NATIONAL LEVEL INSITITUTES


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ROLE OF

SIDBI,NSIC,

SFC.


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SIDBI

SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA-

SIDBI

For ensuring larger flow of financial and non-financialassistance to the small scale sector, the government of Indiaset up the Small Industries Development Bank of India

(SIDBI) under Special Act of Parliament in 1989 as a whollyowned subsidiary of the IDBI. The SIDBI has taken over theoutstanding portfolio of the IDBI relating to the small scalesector.


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The important functions of IDBI are as follows:

(1) To initiate steps for technological upgradation andmodernization of existing units.

(2) To expand the channels for marketing the products ofSSI sector in domestic and international markets.

(3) To promote employment oriented industriesespecially in semi-urban areas to create moreemployment opportunities and thereby checkingmigration of people to urban areas.


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The SIDBIs financial assistance to SSIs is channeledthrough existing credit delivery system comprising

state financial corporations, state industrial

development corporations, commercial banks and

regional rural banks.


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(NSIC)

NATIONAL SMALL INDUSTRIES CORPORATION:

The National Small Industries Corporation

(NSIC), an enterprise under the union ministry of

industries was set up in 1955 in New Delhi to

promote aid and facilitate the growth of small

scale industries in the country. NSIC offers a

package of assistance for the benefit of smallscale enterprises.


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1. Single point registration: Registration under

this scheme for participating in

government and public sector undertaking

tenders.

2. Information service: NSIC continuously gets

updated with the latest specific

information on business leads, technology and

policy issues.

3. Raw material assistance: NSIC fulfills raw

material requirements of small-scale

industries and provides raw material on

convenient and flexible terms.


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4. Meeting credit needs of SSI: NSIC facilitatesanctions of term loan and working capital creditlimit of small enterprise from banks.

5. Performance and credit rating: NSIC givescredit rating by international agencies subsidized

for small enterprises up to 75% to get better creditterms from banks and export orders from foreignbuyers

6. Marketing assistance programme: NSICparticipates in government tenders on behalf ofsmall enterprises to procure orders for them.


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SFC- KSFCKARNATAKA STATE FINANCIAL CORPORATION

The KSFC was established by the government ofKarnataka in 1956 under the state financial

corporation act 1951 for extending financialassistance to set up tiny, small and mediumscale industrial units in Karnataka. Since 1956 itis working as a regional industrial development

bank of Karnataka. KSFC has a branch office ineach district; some districts have more than onebranch.


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KSFC extends lease financial assistance and hire purchase

assistance for acquisition of

machinery/equipment/transport vehicles. KSFC has

merchant banking department which takes up the

management of public issues underwriting at shares,

project report preparation, deferred payment guarantee,and syndication of loans, bill discounting and similar

tasks.

KSFC give preference to the projects which

are

(i) Promoted by technician entrepreneur.

(ii) In the small-scale sector.


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(iii) Located in growth centers and developing areas ofthe state;

(iv) Promoted by entrepreneurs belonging toscheduled castes and scheduled tribes,

backward classes and other weaker sections of

society.

(v) Characterized by high employment potential.

(vi) Capable of utilizing local resources; and

(vii) In tune with the declared national priorities.


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The eligible industrial concerns for financial assistance

from KSFC are those engaged/to be engaged in

manufacture, preservation, processing of goods, mining,

power, hotels, R & D of any product or process ofindustrial concern, weigh bridge facilities, power

laundries, photocopying, hiring of heavy material

handling equipment, cranes and other earth moving

equipments, .Contd


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hospitals, nursing homes, medical stores,

computers, tourism related activities,

construction of roads, tissue and horticulture

software development, software parks, blockboard vehicles, office construction, go down

and warehouse construction, mobile

canteens, commercial complexes, traininginstitutes, office automation and so on.


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Loan Schemes of KSFC

KSFC has evolved loan schemes for extending

financial assistance to industrial concernspromoted by rural artisans, weaker sections of

society, disabled entrepreneurs, ex-servicemen,

women entrepreneurs and others. The various loan schemes of KSFC are given

below:

(1) Composite loan scheme(2) Disabled entrepreneurs loan scheme.


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(4) Ex-service men loan scheme.

(5) National equity fund scheme.

(6) Mahila Udyama nidhi loan scheme.

(7) Single window loan scheme.

(8) Transport loan scheme.

(9) Computer loan scheme.

(10) Modernization loan scheme.

(11) Diesel generator loan scheme.

(12) Equipment finance loan scheme.

(13) Tourism related activities loan scheme.


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(14) Hospital/nursing / medical store loan scheme.

(15) Electro-medical equipment loan scheme.

(16) Assistance for acquiring indigenous or importedsecond-hand machinery.

(17) Qualified professionals loan scheme.

(18) Scheme of assistance for acquisition of ISO 9000

series of certification.(19) Hotel /mobile canteen loan scheme.

(20) Industrial estate loan scheme.

(21) Loan scheme for office automation.(22) Loan scheme for training institution.

(23) Loan scheme for private software technologyparks.


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DISTRICT INDUSTRIES

CENTERS

(DIC)


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The District Industries Centers (DICs) programmewas started in 1978 with a view to provide

integrated administrative framework at the

district level for promotion of small scaleindustries in rural areas. The DICs are envisaged

as a single window interacting agency at the

district level providing service and support to

small entrepreneurs under a single roof.


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DICs are the implementing arm of the central and

state governments of the various schemes and

programmes. Registration of small industries isdone at the district industries centre and PMRY

(Pradhan Mantri Rojgar Yojana) is also

implemented by DIC. The organizational structure

of DICS consists of General Manager, Functional

Managers and Project Managers to provide

technical services in the areas relevant to the

needs of the district concerned. Management ofDIC is done by the state government.


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The main functions of DIC are:

(1) To prepare and keep model project profiles forreference of the entrepreneurs.

(2) To prepare action plan to implement the schemeseffectively already identified.

(3) To undertake industrial potential survey and to identifythe types of feasible ventures which can be taken up in ISBsector, i.e., industrial sector, service

sector and business sector.

(4) To guide entrepreneurs in matters relating to selectingthe most appropriate machinery and equipment, sources of

it supply and procedure for importing machineries.


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(5) To provide guidance for appropriate loan amount anddocumentation.

(6) To assist entrepreneurs for availing land and shedequipment and tools, furniture and fixtures. InstitutionalSupport.

(7) To appraise the worthness of the project-proposalsreceived from entrepreneurs.

(8) To help the entrepreneurs in obtaining required

licenses/permits/clearance.

(9) To assist the entrepreneurs in marketing their productsand assess the possibilities of ancillarization.


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(10) To conduct product development workappropriate to small industry.

(11) To help the entrepreneurs in clarifying their

doubts about the matters ofoperation of bank accounts, submission of monthly,quarterly and annual

returns to government departments.

(12) To conduct artisan training programme.

(13) To act as the nodal agency for the district forimplementing PMRY (Prime

Minister Rojgar Yojana).(14) To function as the technical consultant of DRDAin administering IRDP and

TRYSEM programme.


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(15) To help the specialized training organizations toconduct Entrepreneur development

programmes.

In fine DICs function as the torch-bearer to thebeneficiaries/entrepreneurs in setting up andrunning the business enterprise right from the

concept to commissioning. So the role of DICs inenterprise building and developing small scalesector is of much significance


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SMALL INDUSTRIES

SERVICE INSTITUTES

(SISI)


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The small industries service institutes have been set

up in state capitals and other places all over the

country to provide consultancy and training to small

entrepreneurs both existing and prospective.

The main functions of SISI include:

(1) To serve as interface between central and stategovernment.

(2) To render technical support services.

(3) To conduct entrepreneurship developmentprogrammes.

(4) To initiate promotional programmes.


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The SISIs also render assistance in the

following areas:

(1) Economic consultancy/information/EDPconsultancy.

(2) Trade and market information.

(3) Project profiles.(4) State industrial potential surveys.

(5) District industrial potential surveys.

(6) Modernization and in plant studies.

(7) Workshop facilities.

(8) Training in various trade/activities.


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governament support to entrepreneurship in india

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