Online edition of India's National Newspaper
Thursday, Oct 11, 2007
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Online edition of India's National Newspaper Thursday, Oct 11, 2007 ePaper |
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Tamil Nadu
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Chennai
Loans for first-generation entrepreneurs Flexible interest rates for traditional units CHENNAI: The Tamil Nadu Industrial Investment Corporation has chalked out a plan to bring down its non-performing asset from the present 13.44 per cent to 5 per cent and disburse Rs.1,000 crore in loans in the next three years. Addressing a seminar on “Emerging opportunities for MSMEs,” organised by the Confederation of Indian Industry here on Wednesday, Corporation’s chairperson O.P. Sosamma said: “Keeping in mind the sustainability of the industry in the services sector and the vulnerability of small and medium enterprises in the post-liberalisation environment, we are due for a change in attitude and activities. With the availability of knowledgeable local resources and competent staff, we can still play a relevant role.” Format simplified
Managing Director S.K. Prabakar said: “We have simplified the application format and time-bound sanctions and disbursements. Loans are provided to first-generation entrepreneurs at cheaper rates and we have flexible interest rates for traditional units.” Since its inception, the Corporation assisted 1,00,763 lakh units, with a cumulative disbursement of Rs. 5,827.48 crore. However, the contribution by the manufacturing sector in the last two decades was less compared to the services sector and textiles. Auto components, engineering, wind mills, food and agro and textile sectors were seeking more funds. Exit policyThe chairperson said the Corporation had put in place an exit policy to bring down the number of disputes that now involved 100 firms. The disputes were related to loans sanctioned before 2000. Prudential normsThe strict implementation of prudential norms, Ms. Sosamma said, put a strain on the Corporation’s finances. “We are facing a tough competition from banks with regard to loans. We provide loans at an interest rate ranging from 12 to 14 per cent. Last year, we sanctioned loans worth Rs. 457 crore, and this year we plan to sanction Rs. 750 crore.” Profits posted“The TIIC has been posting profits for the last four years. We will easily touch the Rs 1,000-crore mark in disbursement in the next three years. The TIIC ranks among the top few State Finance Corporations in the country.” K.S. Shriram, CII Southern Region past chairman, said small and medium enterprises could grow only if they were given finance at an appropriate rate. These units generated 40 per cent employment and accounted for 47 per cent of exports.
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