The primary objective of this scheme is providing capital to MSMEs to invest in marketing, brand building, creation of distribution network, technical know-how, R&D, etc. Also they provide longer initial moratorium on principal installments to ensure greater chances of success for the ventures. It strengthens the business and backs cash flows rather than Asset Cover/ Collateral Security.
Who can apply?
- Any registered MSME
- SIDBI’s existing customers (meeting internal rating criteria)
- Units with past 3 years of profitability and 2 years of satisfactory banking credit track record (meeting internal credit rating criteria) Acceptable external rating from CRISIL, ICRA, D&B, SMERA, etc. would be desirable.
Benefits:
- Provides assistance in form of Mezzanine/ Convertible Instruments, Subordinated debt and Equity (in deserving cases).
- This quasi assistance has a higher moratorium on repayment and a flexible structuring.
- Leverage Equity / Sub Debt Assistance from SIDBI for raising higher debt funds.
- Avoid complexities of Enterprise Valuation, Exit Issues etc – associated with Equity Investments.
How to apply?
Visit the website of SIDBI and fill the enquiry form provided and thereby follow the instructions.
Add Your Comments