SMEs act as propellants of the Indian economy in terms of their contribution to the country’s gross domestic product, exports, employment generation and encouraging entrepreneurship. This pivotal sector faces tremendous challenges in the post liberalization era both from the domestic and international markets. In such a scenario, it is imperative to ensure the growth and long term viability of SMEs through smooth flow of credit to this sector.

Financial Institutions tend to be risk averse and conservative in respect of SMEs. SME entrepreneurs are at times deficient in financial skills and are unable to formulate and push through bankable proposals. They do not maintain regular books of accounts and therefore don’t evoke full confidence of the creditors.

SMEs need to set up effective linkages with credit agencies and venture capitalist through e- enabled channels to procure adequate and timely finance. This will go a long way in fostering entrepreneurship in the country.