The Hindu : Tamil Nadu / Chennai News : Concept of micro credit to micro enterprises to be introduced soon

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Concept of micro credit to micro enterprises to be introduced soon

Special Correspondent

Global Infrastructure Services and Solutions will launch it

Micro enterprises can avail of collateral free loans from Rs.50,000 to Rs.5 lakh
Proposal to introduce concept of mentor for every entrepreneur

CHENNAI: In the next two-three weeks, Global Infrastructure Services and Solutions (GISS) will introduce the concept of providing micro credit to micro enterprises, said D. Sabitha, GISS, Chief Executive Officer, here on Friday.

Delivering the keynote address at a two-day workshop on “a global perspective on cluster value chain and entrepreneurship development” organised by TANSTIA-FNF Service Centre, she said that micro finance institutions (MFIs) provided loan of Rs.25,000, while banks had an upper limit of Rs.5 lakh. GISS would step in to fill the gap by providing timely financial intervention with the help of Repco Bank and SIDBI.

“There are about 6,000 clusters in the State – 388 industrial, 400 handloom, 2,000 handicrafts and 3,000 micro enterprises. We have formed two societies – Federation of Ambattur Micro Engineering Unit and Federation of Tact Micro Engineering Unit. Each unit will have seven members. Our target is to form 10 such societies in the coming year,” she said. The loans will be disbursed in the next two-three weeks. Micro enterprises can avail of collateral free loans from Rs.50,000 to Rs.5 lakh for which the guarantee will be given by all the members. The tenure of the loan is for three years.

43 clusters to be set up

In his inaugural address, G. Santhanam, Industries Commissioner and Director of Industries, said that it had been proposed to set up 43 clusters in the State and the proposals have been sent to the Centre for validation. These clusters will get funds ranging from Rs.1 crore to Rs.10 crore.

Out of the 43 clusters, MSME-DI will set up 14, coir board 1, ITCOT 15, Sago Serve 1 and ni-msme 12. It is meant for wet grinder, rice mill, plastics, bus body building, sago, coir, safety matches, ceramic, leather, gems and jewellery and mango pulp.

Mr. Santhanam said it was also proposed to introduce the concept of mentor for every entrepreneur to ensure that loan was used in a reasonable manner. The mentor will be identified by the trade bodies and he will help the entrepreneur. R.M. Nair, SIDBI, general manager, said that they were ready to provide finance to tiny sector at low rate of interest and he mentioned that Japan International Co-operation Agency had extended line of credit for setting up energy saving projects. “The scheme is not known to the people. Small and Medium Enterprises can make use of the scheme to set up windmill projects. The loan will be available at 8.5 per cent interest, if we take the depreciation benefits, the cost of fund will be around 3-4 per cent,” he said.

D. Gandhikumar, TANSTIA president, said that micro enterprises were unable to invest huge sums in various fields of activities and that’s why they came forward to form clusters.

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