Small-scale units can now get a composite bank loan of up to Rs 50 lakh as against a maximum of Rs 25 lakh earlier. According to the Reserve Bank of India (RBI), public sector banks have agreed to enhance the credit limit to help SSI units meet the term loans and the working capital requirements.
Composite loans are those loans which are given to meet both the working capital requirements and also for the acquisition of fixed assets by a unit.
"This step will act as a fillip for start-up companies and mid-cap companies considerably," said a senior official with the Small Industries Development Bank of India (SIDBI), the leading institutional lender to the SSI sector.
This enhancement of the limit should certainly help a lot more of SSIs to make use of this form of credit, said a general manager in a public sector bank.
