Finance Minister, Pranab Mukherjee stressing on the availability of adequate finance to MSMEs, urged banks to focus on enhancing credit flow to MSME entrepreneurs as a target group. This will not only help economy to be back on track but also achieve the
Finance Minister, Pranab Mukherjee stressing on the availability of adequate finance to MSMEs, urged banks to focus on enhancing credit flow to MSME entrepreneurs as a target group. This will not only help economy to be back on track but also achieve the goal of inclusive development.
"Adequate finance for MSMEs not only has potential to revive the economy but also helps in achieving our cherished goal of inclusive development." Mukherjee said while speaking to the Chiefs of Public Sector Banks (PSBs) and Financial Institutions (FIs) in New Delhi on Tuesday.
"We have changed the orientation of Small Industries Development Bank of India (SIDBI) to fill the gaps in MSME eco-system. Banks have the most crucial role to provide finance and banks should focus on entrepreneurs of this target group particularly those requiring micro finance," the minister added.
Mukherjee also asked banks to reduce non-performing assets (NPAs) for the financial health of the sector.
"I am happy that banks have taken up the challenge to reduce NPAs and made a record recovery against prudential write-off in the last quarter ending March 2012... I urge you to deploy various tools at your command for containing and rolling back NPAs in accordance with the guidelines of the Reserve Bank of India," he said.
There has been reduction in gross NPAs from the level of 3.18 percent in December 2011 to 3.10 percent in March 2012.
Minister said the recent decisions on restructuring of loans in the textile sector and power distribution companies were good examples of NPA management.
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