New Delhi, January 15: The Reserve Bank of India will organize Town Hall meetings with leading Micro, Small and Medium Enterprises (MSMEs) clusters to facilitate higher credit flows to the sector. A decision in this regard has been made during the recently held Meeting of the Empowered Committee to Monitor Credit Flows to the MSME sector.
The Town Hall meetings will offer an open forum for RBI's senior officers and MSME borrowers to interact freely to de-bottleneck the credit flow to this priority sector of Indian economy, KNN India reports. RBI, in its recent review of the performance of the banks under credit flows to the MSMEs of Delhi, has reportedly observed that most banks have failed to achieve the year on year growth rate of 20 per cent in credit flow to the SMEs.
The Prime Minster's Task Force had set a minimum target of 20 per cent year on year growth in the outstanding credits from Banks to the MSMEs, of which at least 50 per cent should flow to the micro enterprises, who have an investment upto Rs 25 lakh, the report said. At an all India level, the achievement of this target has been really poor. Banks have failed to reach the target in Delhi as well despite the national capital's high income level and large manufacturing and business sector.
While the large public sector banks, whose mandate from the Government is to fully finance the priority sector, have fared badly; the private sector banks like HDFC and ICICI Bank which are considered to be Banks for the upper class, have interestingly achieved their targets continuously.