Who is Eligible for SIBDI Loan?

The eligibility criteria for SIDBI loans vary depending on the specific loan scheme. However, there are some general eligibility criteria that apply to all SIDBI loans:

• The borrower must be a MSME as defined by the Micro, Small and Medium Enterprises Development Act, 2006.
• The borrower must be engaged in a viable business activity.
• The borrower must have a good financial record and credit rating.
• The borrower must have the necessary collateral to secure the loan.

In addition to these general eligibility criteria, SIDBI also has specific eligibility criteria for each of its loan schemes. For example, the eligibility criteria for the SIDBI Make in India Soft Loan Fund for Micro and Small Enterprises (SMILE) scheme are as follows:

• The borrower must be a new enterprise in the manufacturing and services sector or an existing enterprise undertaking expansion.
• The borrower must have a project with a minimum investment of Rs. 10 lakh for Equipment Finance and Rs. 25 lakh for other purposes.
• The borrower must have a good financial record and credit rating.
• The borrower must have the necessary collateral to secure the loan.

Small Industries Development Bank of India (SIDBI): SIDBI was established as a statutory body in 1988 under a special Act of the Indian Parliament, which came into force on April 2, 1990. SIDBI full form is Small Industries Development Bank of India. SIDBI headquarter is in Lucknow, Uttar Pradesh. It is one of the four All-India Institutions, the others being NABARD, EXIM, and NHB.

Initially, SIDBI was fully involved in industrial development activities in the country by managing SIDF (Small Industries Development Fund) and NEF (National Equity Fund) and was the financial base for funding the MSME (Micro, Small, and Medium enterprises) sector. SIDBI was owned by a consortium of SBI as a share with 15.65 %, LIC as a share with 13.33 %, the Government of India as a share with 20.85 %, NABARD as a share with 9.36 %, and other public financial institutions as share with 40.81 %.

SIDBI assists around Rs 5.45 lakh crore to the MSME sector in the country to expand the market and develop its innovative thoughts and technologies to help to produce profitable products. SIDBI aims to work with and reinforce the flow of credit to MSMEs and address monetary, formative, and developmental gaps in the MSMEs industry zones across the country

SIDBI is mainly focusing on establishing more than 55% of MSMEs located in the rural areas of the country. In 2013, the Government of India set up a committee called R.S. Gujaral’s committee of financial exports to boost the MSME sector. To minimize human interaction in the MOU process Government of India has implemented a module called “E-biz”  under the National E-governance plan by the DIPP (Department of Industrial Policy and Promotion).