Tamil Nadu is likely to emerge as the leading destination for Axis Bank to provide loans to MSMEs.
Tamil Nadu is likely to emerge as the leading destination for Axis Bank to provide loans to Micro, Small and Medium Enterprises (MSME) in the the next three years, says a PTI report, citing a top official’s statement.
The bank has grown its MSME portfolio to Rs 5,800 crore in the region with a customer base of 2,800, including manufacturing, trade as well as services, G Edwin, Geography Head-South, SME Banking, Axis Bank, told reporters.
The bank aims to be a partner in progress for the SMEs in the region and is introducing specially structured and customised "Fast-Track Loans", an entire suite of products that is superior, flexible and designed to provide quick disbursement and faster credit delivery, he said.
The bank advances to SMEs has increased by 18.6 per cent year on year to about Rs 36,000 crore during financial year 2014, constituting 15.4 per cent of the bank's total advances, of which contribution of south was Rs 12,000 crore, in which Tamil Nadu contributes 47 per cent, he said.
SME banking, with over 18,000 customers, has been a major focus and key growth area for the bank, contributing over 15 per cent to its total lending portfolio, he said.
When pointed out that lending rate for SME segment was comparatively more than that for corporate or large industries, Edwin, said the risk factor was little more in SME sector and the rate was only 0.5 or 0.75 per cent more.
Edwin also said that recovery rate was considerably good in MSME sector.
With 42 dedicated SME centres and 17 cells across India, the bank proposed to increase them, in view of the potential in the sector and a second centre will be opened in Madurai in Tamil Nadu which was witnessing good growth, Edwin said.
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