Event Details
MSMEs are key contributors to the country's economic activity as an important source of employment, growth, and innovation. Despite their essential role, MSMEs receive a disproportionately small share of credit from the financial system, a trend that persists across developed and developing countries. In India, a greater number of MSMEs tend to be informal in nature, have limited publicly available information, and are relatively less aware of the bank requirements, all of which result in higher information asymmetries impeding bank lending to the sector.
However, hit by the COVID-19 and its aftermath, the MSME sector almost crash-landed in 2020, facing a strong contraction in revenue. The sector suffered the most in ensuring business continuity, challenged by severe liquidity crunch and With the COVID 19 pandemic disrupting economic activities worldwide, the role of fintech, banks, and NBFCs in powering small businesses in the post-pandemic new world will go way beyond routine financing. Adoption of innovative lending models will not only forge the right balance for financial stability but also encourage a focus on the credit needs of small businesses in the country and NBFCs and fintechs may be considered as better equipped to support this endeavour. The continued evolution of the MSME lending landscape can be another step towards achieving the vision of Aatmanirbhar Bharat.
Although, given the proportion of the problem around lack of finance, it is clear no single solution can bridge the gap and create an enabling environment. Therefore, to address the perceptible credit gap, there is a need to introduce and adopt new financing models. Alternative financing tools, such as equity finance, peer to peer lending, TReDS, etc. have a lot of potential to grow. In comparison to larger firms, MSMEs often have difficulties to access financing from the formal financial system because financial institutions, particularly commercial banks, often view providing loans to them as too risky or involving high transaction costs.
National banks can play a significant role in promoting and expanding financial inclusion of MSMEs through innovative products to help overcome market failures as well as create new markets from which commercial financial institutions can also benefit.
Keeping in view the above Indian Chamber of Commerce (ICC) in association with Department of MSME & Department of Finance, Government of Odisha organizing an "MSME - BANKING & FINANCE e-Conclave [Unlocking Economic Stimulus & Finance Facilitation for MSME's] on 7th October 2021, 1100hrs on ICC Virtual Platform.
This conference is aimed to bring together the Government, beaurocrats, Industry leaders, leading Banks and Financial Institutions to discuss the challenges and tools to enhance and bridging the financial gaps of MSMEs. It will also provide a premier interdisciplinary platform for MSME Industries, Startups, consultants, Banks & NBFCs, Academic & Institutions, NGOs, Social Entrepreneurs to present and discuss the most recent innovations, trends and concerns as well as practical challenges encountered and solutions adopted in the fields of MSME Financing.
Key Points of Discussion:
v The impact of COVID-19 on MSMEs
v MSME Finance Gap: Assessment of the Shortfalls and Opportunities
