Brands
Discover
Events
Newsletter
More

Follow Us

twitterfacebookinstagramyoutube
Youtstory

Brands

Resources

Stories

General

In-Depth

Announcement

Reports

News

Funding

Startup Sectors

Women in tech

Sportstech

Agritech

E-Commerce

Education

Lifestyle

Entertainment

Art & Culture

Travel & Leisure

Curtain Raiser

Wine and Food

YSTV

ADVERTISEMENT
Advertise with us

Edelweiss Group, Central Bank of India join hands to co-lend to MSMEs

The partnership aims to facilitate speedy disbursal of credit for MSMEs across a bouquet of products, including machinery and business loans.

Edelweiss Group, Central Bank of India join hands to co-lend to MSMEs

Monday September 02, 2019 , 2 min Read

Edelweiss Group

ECL Finance Ltd, a subsidiary of Edelweiss Financial Services, and Central Bank of India have signed an agreement for priority sector lending to Micro, Small and Medium Enterprise (MSME) customers, media reports said.

 

The partnership aims to facilitate speedy disbursal of credit across a bouquet of products, including machinery and business loans, and comes after the Reserve Bank of India announced progressive co-origination policy in September 2018, allowing banks and NBFCs to co-lend to a wider set of enterprise owners, a BSE filing by Edelweiss Group said.

 

"This is the first such co-origination partnership of Central Bank of India with an NBFC,” it said.

 The alliance will ensure robust underwriting for originations, positively impacting the credit-worthiness of MSMEs in over 100 cities in India.

Many MSMEs face challenges of high-interest rates or are excluded from access to banking services, given geographical inaccessibility, it said.

 

"Through this innovative model of lending, MSMEs will now enjoy a blended lower rate of interest, translating into lower cost of funds, helping them deploy capital more effectively in their business," it said.


 Speaking on the development, Central Bank of India MD and CEO Pallav Mohapatra said:

"This partnership shall enable us to collaborate and harness technology, bring in the best practices in credit underwriting finer pricing and render a far superior experience in terms of turnaround time to customers.

 

Recently, State Bank of India (SBI) also has stitched a co-origination agreement to finance small businesses. The SBI official said that SBI has forged an agreement with an NBFC for SME financing and is also in talks with at least four more NBFCs for lending to SMEs and also for extending housing loans.

 

Co-origination is a new system introduced by the Reserve Bank of India (RBI) in the wake of the liquidity crisis at non-banking finance companies (NBFCs) to enhance credit flow to productive sectors. Fresh credit flow can help both the troubled NBFCs and also help prop up the sagging growth.



(Edited by Evelyn Ratnakumar)