Small Scale Industries Small Scale Industries Development Corporation Development Corporation (SSIDCS)(SSIDCS)

Commercial Banks

Commercial banks are the source of short term funds most frequently used by

entrepreneurs when collateral (tangible guaranty) is available.

The scheduled commercial banks in country (299

banks) comprise State bank of India & its associated

banks (8), private sector banks (34), regional and

rural banks (196) and foreign banks (42).

◦For a very long time, commercial banks didn’t come forward to extend financial assistance to small scale industry because of weak economic base.

◦First lead was taken by SBI, in consultation with RBI in March 1956 by setting up scheme for provision of credit.

◦Normally banks provide assistance for working capital requirement of SSI.

◦RBI introduced a LEAD BANK SCHEME

RBI introduced special package of measure of financing SSI and advised banks to take various measure and aimed at increasing credit flow.

Availability of credit improved further the stipulation of foreign credit to extend 10% of their net bank credit to SSI’s.

Commercial Banks of India

IDBI- Industrial Development Bank of India

ICICI- Indian Credit & Investment Credit Corp.

IFCI- Industrial Finance Corporation of India

LIC- Life Insurance Corporation of IndiaUTI (AXIS Bank)EXIM BankSIDBISIDC’S

Small scale industries were dream of Mahatma Gandhi, father of our nation.

They are not capital based rather they are talent based industries which can be owned and run by middle class people.

Small scale industry is a term which applies to the small entrepreneurs who are engaged in manufacture and production on a micro scale. It mainly refers to agro- based rural industry which doesn't require huge capital influx and large infrastructure.

These small scale industries also include the indigenous cottage industry and the handicrafts industry. The development of small scale industries is very important for a country like India which has mainly rural economy.

These small scale industries which are mainly agro- based in nature would provide job for millions of Indians and would contribute largely to the overall growth of the Indian economy .

The SSIDC were set up in various states under companies Act, 1956 as State Government undertakings.

At present 18 SSIDCs are in operation :Some important activities are:Procurement & distribution of scarce

raw material.Supply of machinery on hire purchase

basis.Providing assistance for marketing of

the products of small scale units.

Construction of industrial estates/sheds, providing allied infrastructure facilities and their maintenance.

Providing management assistance to production units.

Small Scale Industry Small Scale Industry Development Organization.Development Organization. It is the Office of the Development Commissioner

for Small Scale Industries. SIDO was established in 1954 on the basis of the recommendations of the Ford Foundation. It has over 60 offices and 21 autonomous bodies under its management. These autonomous bodies include Tool Rooms, Training Institutions and Project-cum-Process Development Centers.

Various Services provided by SIDO to the SMEs:- facilities for testing, tool menting, training for

entrepreneurship development preparation of project and product profiles technical and managerial consultancy assistance for exports pollution and energy audits

Small Scale Service & Small Scale Service & Business Enterprise (SSSBEs)Business Enterprise (SSSBEs) The investment up to 10 lakh excluding land

and building is considered as benefit to small scale sector:

Indirect finance in the small-scale industrial sector will include credit to :

Agencies involved in assisting the decentralized sector in the supply of inputs and marketing of outputs of artisans, village and cottage industries.

Government sponsored Corporation/organizations providing funds to the Weaker sections in the priority sector.

  

Advances to handloom co-operatives. Term finance/loans in the form of lines of credit

made available to State Industrial Development Corporation/State Financial Corporations for financing SSIs.

Credit provided by banks to Khadi and Village Industries Commission (KVIC) under the scheme for provision of credit to KVIC by consortium of banks for lending to viable Khadi and Village Industrial Units.

Funds provided by commercial banks to SIDBI/SFCs will be eligible for inclusion under the priority sector as indirect finance to SSI.

Financing of NBFCs or other intermediaries for on-lending to the tiny sector.

All new loans granted by banks to NBFCs and other intermediaries for on-lending to SSI sector with effect from November 11, 2003.

 

Food & Agro-based Food & Agro-based processing sectorprocessing sector Fruit and vegetable processing industry Food grain milling industry Dairy products Processing of poultry and eggs, meat products Fish processing Bread, oilseeds, meals (edible), breakfast foods,

biscuits, confectionery (including cocoa processing and chocolate), malt extract, protein isolate, high protein food, weaning food and extruded/other ready to eat food products

Aerated water/soft drinks and other processed foods

Special packaging for food processing industries Technical assistance and advice to food

processing industries

Khadi & Village Industries Khadi & Village Industries Commission (KVIC)Commission (KVIC)KVIC is a statutory body established

by an Act of parliament(1956).Objectives:

Social objective is providing employment.

Economic objective of producing saleable articles.

Building up a strong rural community spirit.

Functions :Functions :Major function for planning,

organizing, promoting and implementation of programs for the development of Khadi and other villages industries in the rural areas

KVIC also promotes the production techniques and equipment employed in Khadi and village industries.