Explore this blog to gain insights into SIDBI—its full form, operational scope, responsibilities, career possibilities and its pivotal role in shaping our nation’s economic landscape for industrial development and growth.
What is SIDBI?
SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA
SIDBI stands for the Small Industries Development Bank of India, established in, 1990, under an Act of Parliament. It functions as the principal financial institution for the promotion, financing, and development of Micro, Small, and Medium Enterprises (MSMEs) in India. As a specialized financial institution, SIDBI provides various financial and support services to MSMEs, including direct and indirect lending, refinancing facilities, advisory services, and assistance in technology and marketing. It collaborates with other institutions and stakeholders to foster the growth of MSMEs, playing a crucial role in the economic development and sustainability of the sector in India.
All about SIDBI and its Establistment
SIDBI or Small Industries Development Bank of India was formulated on 2nd April 1990 with its headquarters in Lucknow.
SIDBI operates under the Department of Financial Services, Government of India. It can be called a developmental finance institution and is a wholly owned subsidiary of IDBI (Industrial Development Bank of India), established under the special Act of the Parliament 1988.
SIDBI, among the 5 ‘All India Financial Institutions,’ overseen by the Reserve Bank alongside EXIM Bank, NABARD, NHB, and NaBFID. These institutions collectively wield a significant influence in financial markets by facilitating credit extension and refinancing operations. They serve as pivotal pillars, addressing the long-term financing requisites of the industrial sector. SIDBI’s pivotal role in this consortium lies in its specialized focus on fostering micro, small, and medium enterprises (MSMEs). Through tailored lending, advisory services, and technological aid, it plays a crucial part in nurturing and empowering the MSME sector, fostering economic growth, innovation, and employment generation in India’s diverse industrial landscape.
Head of SIDBI
The current agency executive or the Chairman and Managing Director of SIDBI is – Shri. Sivasubramanian Ramann, since April, 2021. He is from the 1991 batch of the Indian Audit & Accounts Service (IA&AS). Before joining SIDBI, he served as the MD & CEO of National E-Governance Services Limited (NeSL) starting in December 2016. His prior experience includes roles as Principal Accountant General (Audit) in Jharkhand, Ranchi and CGM & Executive Director at SEBI.
Facilities offered by SIDBI
FUNCTIONS OF (SIDBI) SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA
- Refinancing – Small Industries Development Bank of India or SIDBI refinances loans that are extended by the PLIs to the small-scale industrial units and also offers resources assistance to them.
- Discounting of Bills – SIDBI is also responsible for discounting & rediscounting of bills that arises from sale of machinery to or manufactured by industrial units in the small scale sector.
- Upgradation – SIDBI is also responsible for initiating steps that will further assist in the technological upgradation and modernisation of the existing industrial units.
- Providing Loan /Credit – It ensures proper and timely flow of credit for working capital as well as term loans to ‘Small Scale Industries’ (SSI) in cooperation with commercial banks.
- Other Services – SIDBI also provides other services like factoring, leasing etc. to the industrial concerns in the small-scale sector.
- Marketing – It also helps in expanding marketing channels for the products of SSI (Small Scale Industries) sector both in the domestic as well as international markets.
- Venture Funds – SIDBI co-promotes state level venture funds in association with respective state government.
OTHER ACTIVITIES of SIDBI
SIDBI has extended its area of work and reach to various other sectors too. Apart from the above mentioned basic functions that SIDBI is responsible and supposed to deliver, it has floated many other entities to perform other related activities,as follows –
- SIDBI Venture Capital Limited (SVCL) – for providing Venture Capital (VC) assistance to MSMEs.
- Micro Units Development & Refinance Agency (MUDRA) – for ‘funding the unfunded’ micro enterprises in the country.
- Receivable Exchange of India Ltd. (RXIL) – to enable faster realisation of receivables by MSMEs.
- SMERA Ratings Limited (SMERA) – for credit rating of MSMEs, renamed as Acuite Ratings & Research Limited.
- India SME Technology Services Ltd (ISTSL) – for technology advisory and consultancy services.
- India SME Asset Reconstruction Company Ltd. (ISARC) – for speedier resolution of Non-Performing Assets (NPA) in the MSME sector.
SIDBI also plays an important role in supporting the Government of India in its initiatives and works as a nodal agency for some of the schemes related to development of MSMEs, such as Make in India and Startup India.
Note :- A Nodal Agency, whether governmental or state-based, represents a lasting or semi-permanent entity within the government system entrusted with overseeing and managing particular functions.
Career possibilities in SIDBI
The SIDBI Assistant Manager notification 2023 for the General Stream has been released on the official website. The recruitment process for SIDBI Grade A involves Group Discussion (GD) and Interview rounds, scheduled to take place between December 2023/ January 2024. Prospective candidates can access detailed information regarding the application process, eligibility criteria, and other relevant updates on the official SIDBI website.
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