He also shared some key trends in the financing domain for MSMEs and the bank’s plans for this sector.
What importance do Indian MSMEs carry for Canara Bank?
MSMEs are an integral part of the economic system in India as well as in other parts of the world. Banking organisations have set their targets to cover this sector comprehensively, and MSMEs are the focal point for almost every bank in India. For Canara Bank as well, MSMEs hold great prominence. In order to treat them well, we have branches that can handle SMEs in an exclusive manner. Their issues are different, and the opportunities in this sector are huge, so they need special attention. We are providing the same to the sector.
What are the challenges that SMEs are facing with regards to their financing needs?
There is no doubt that Indian MSMEs are facing challenges in doing business. One of the main challenges that they are facing is access to finance. Although, as a banker, I would feel that finances are available and accessing it is not a problem, the fact is that, in this area, a gap does exist between banks and entrepreneurs. This gap must be removed. To achieve this, banks have set up policies for SMEs, and the implementation of these policies is also happening.
How is Canara Bank helping MSMEs?
We consider MSMEs as one of our biggest priorities. We have a dedicated, well-defined MSME lending policy, which we have adopted in tune with the government of India’s guidelines as per MSMED Act, 2006.
We also work very closely with SME clusters across the country. We have 388 branches operating in these SME clusters. These branches have a special focus towards the SME entrepreneurs. Apart from this, we also work for the revival of sick units.
What is the best possible way to bridge the gap between bankers and entrepreneurs?
To deal with this challenge, both banks and SMEs need to play a greater and more pro-active role at various levels. While banks should consider the MSME sector as a priority one, MSMEs, specifically the entrepreneur community, should come forward to enhance their knowledge. SME associations can become enablers in this direction. They can act as catalysts in bridging the gap between the two parties. I would urge SME associations to organize special camps to promote awareness about various financing schemes offered by banks to small firms.