SME Times is powered by   
Search News
Just in:   • US is India's 2nd biggest arms supplier, Israel 3rd  • Macron, Merkel pledge common roadmap on eurozone reforms  • US dollar climbs after economic data  • EgyptAir to resume Cairo-Moscow flights  • Oil prices climb as US equities rebound 
Last updated: 21 Feb, 2017  

ss-mundra-THMB.jpg RBI tells banks to go digital to serve MSMEs better

Reserve Bank of India
   Top Stories
» Industry stresses on recognising importance of SME sector
» Public procurement: Modi against unfair clauses against domestic firms
» Naidu calls for greater corporate transparency
» PM addresses Rising India Summit
» Bring in reality in real estate sector: Naidu
SME Times News Bureau | 21 Feb, 2017
The Reserve Bank of India (RBI) on Monday said the traditional banks needed to evolve into new-age digital banks to remain operational as financial technology (FinTech) lending companies were emerging fast as alternative source for the micro-small medium enterprises (MSMEs).

"The age of FinTech is here and for the incumbent banks there is no time to lose. The banks that do not quickly convert in to a new-age digital bank run the risk of becoming history," RBI Deputy Governor S.S. Mundra said.

He was addressing the inaugural NAMCABS (National Mission for Capacity Building of Bankers for financing MSME Sector) seminar organised by College of Agricultural Banking in Mumbai.

"FinTech lending companies and the market place based lending, thus, have an underlying potential to emerge as an alternative source of finance for the small businesses," Mundra said.

He said that the banks must view the success of FinTech ecosystem as an opportunity and not as a threat.

"The FinTech companies have leveraged on growing technological advances and pervasiveness of smartphones and have targeted niches in small and medium enterprise (SME) lending to bridge the funding gap for small businesses with innovative and flexible credit products," he added.

Potentially, the MSME borrowers can apply online in minutes, select desired repayment terms and receive funds in their bank accounts within 2-3 days with minimal hassle, Mundra said.

"There are few documentation requirements, very quick turnaround time and flexible loan sizes and tenors," he said.

As per the International Financial Corporation (IFC), a funding gap of $2.1-2.6 trillion exists for all formal and informal MSMEs in emerging markets alone, which is equivalent to 30 to 36 percent of current outstanding MSME credit, he added.
Print the Page Add to Favorite
Share this on :

Please comment on this story:
Subject :
(Maximum 1500 characters)  Characters left 1500
Your name:

  Customs Exchange Rates
Currency Import Export
US Dollar
UK Pound
Japanese Yen 58.85 56.85
As on 17 Mar, 2018
  Daily Poll
Is counterfeiting a major threat to SMEs?
 Can't say
  Commented Stories
» Starting an import export business: Basic guide for beginners(32)
» Another MSME portal: will it serve its purpose(5)
» Govt forms committee to study FinTech, financial inclusion of MSMEs(2)
» Collateral free loans available for MSMEs: Minister(1)
» GDP surprise(1)
About Us  |   Advertise with Us  
  Useful Links  |   Terms and Conditions  |   Disclaimer  |   Contact Us  
Follow Us : Facebook Twitter