On idea & opportunity of lending to MSMEs
Mr. Ramakrishna Nishtala, MD & CEO and Co-founder was invited for a special panel discussion for ‘MSME Leadership Series – Season 2’ which was jointly hosted by CNBC-TV18 and Union Bank of India. Theme for the panel discussion was ‘Re-Imagining The MSME Economy: Ideas, Incentives & Investments’.
Here below is the verbatim of the statements by Mr. Nishtala:
“I was working in a financial services company (in 2009) and I was travelling to a small place called Annur (Tamil Nadu) which I guess many people may not recognise on the Indian map and I met a person who was a classic micro-enterprise entrepreneur who had grown his business from two to 30 power-looms over a period of 15 years. He wanted to take this number from 30 to about 45 because of huge demand. He thought to apply for a loan and had been to a Bank. And over a five months period and about 23 visits later, the Bank said no to him. This was a moment of epiphany that if you have an entrepreneur who has grown like this from being a power-loom labourer to owner of two looms and later to 30 looms, and he wants to further expand his business but there was no space for him to get a loan. That is when I said let me look at starting a company which is not focused on the ‘SME’ part of the ‘MSME’ which actually gets focused in any way, but for the ‘M’ part- i.e., ‘Micro-enterprises’.”
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