Ludhiana, Feb 25 (KNN) The Small Industries Development Bank of India (SIDBI) today tied up with Jalandhar-based Capital Small Finance Bank (CSFB) to provide concessional finance to MSMEs.

Under the MoU, MSMEs will be provided concessional funding at MCLR (currently 9.6%) under refinance from SIDBI, joint financing/co-financing, cluster development and capacity building of CSFB officials.

Under the MoU, promotional and developmental activities of SIDBI could be taken up jointly with CSFB for the benefit of MSMEs in the areas of skill development, technology and financial linkages, HR, adoption of best practices by MSMEs, including cluster-based interventions in the areas of technology, energy efficiency, energy saving, etc. and for promoting digital financial inclusion initiatives.

" This initiative of SIDBI and CSFB will go a long way in creating a conducive ecosystem for MSME desirous of accessing concessional/composite funding in Punjab," said Manoj Mittal, Deputy MD, SIDBI.

According to Sarvjit Singh Samra, MD, Capital Small Finance Bank, “CSFB is the first small finance bank to tie up with SIDBI and we expect this pact to go a long way in promoting the MSMEs. It will boost the MSE segment by reducing cost of credit to them."

The CSFB has 71 branches in Punjab and Chandigarh. Currently, out of a total loan book of Rs 1,200 crore, the MSMEs account for 22%.