The Small Industries Development Bank of India (SIDBI) has decided to set up a ‘Growth Fund’ to provide risk capital/ equity support to eligible small- and medium-sized enterprises (SMEs).
SIDBI is also planning to assist units in the SME sector at an interest rate of 9.5 per cent per annum, that is 200 basis points below its prime lending rate, with a view to improving the flow of credit to the sector.
SIDBI said the finance under the growth fund, which is expected to become operational within the next three months, will be raised to Rs 500 crore in the next few years.
In order to provide integrated banking services under one roof, SIDBI has received approval from the union finance ministry for allowing working capital and non-fund facility to SME units.
