RBI: Make loans to MSMEs online

Thiruvananthapuram: Reserve Bank of India governor Raghuram Rajan has said an exclusive web portal should be set up as an intermediary between banks and micro small medium enterprises (MSMEs) to tackle hassles faced by entrepreneurs in accessing credit.

Dr Rajan was speaking on “moving up the value chain” at the fourth edition of India MSME Summit, partnered by the Confederation of Indian Industry (CII), here on Monday.

“Unlike bigger firms, MSMEs find it tough to get credit. An exclusive portal will help entrepreneurs. If one bank rejects his/her application, the entrepreneur should have the facility at the website to submit it to the next bank,” Dr Rajan said.

“The sector offers immense opportunities. The youth’s preference to launch start-ups rather than joining big companies is a positive sign. It should be encouraged,” he said.

Kerala with its high rate of literacy and quality education was well placed for revolutionary growth in the sector.

Regulators should facilitate MSMEs to grow and make the sector more competitive. Proper infrastructure and access to online market were a few of the impediments for the growth of MSME sector.

The growth of MSMEs had a social benefit besides economic aspects and employment generation. “MSMEs can be a way of social empowerment. It opens up opportunities for weaker and marginalized sections, including women and underprivileged castes. It is a way to achieve social equality,” he said.