Mumbai, Apr 5 (KNN) The Reserve Bank of India (RBI), today announced that it will lay down a framework by September this year for accreditation of credit counsellors who can assist MSMEs access formal financial system with much ease and flexibility.

Reacting to this, the apex body for MSME associations in India, FISME, said, “The RBI’s initiative appears to be a double edged sword. On the face of it, it is a welcome move.”

In the First Bi-Monthly Monetary Policy Statement 2016-17, RBI Governor Raghuram Rajan said, “The Reserve Bank will lay down a framework by September 2016 for accreditation of credit counsellors who can act as facilitators for entrepreneurs to access the formal financial system with greater ease and flexibility.

Credit counsellors will also assist MSMEs in preparing project reports in a professional manner which would, in turn, help banks make more informed credit decisions,” he added.

On this, Policy Director of Federation of Indian Micro and Small & Medium Enterprises (FISME) Debashis Bandopadhyay said, “Availability of RBI accredited credit counsellors to assist MSMEs in preparation of project proposals will be a welcome move. MSMEs always feel the dearth of experts, available at affordable cost, to prepare project proposals and advise on financial matters.”

It is more so for start-up entrepreneurs who generally come with an expertise in technology or management and lack even the basic knowledge of the financial eco-system. On the flip side, the moot question is from where these counsellors will come from, said Bandhopadhyay.

“They must come from the existing chartered accountants, who probably will undergo some training under RBI guidance and will be accredited as counsellors. Will it make much difference?” asked the apex body adding that, “How these people who otherwise also prepare project proposals for MSMEs, will be wiser overnight? In fact, the immediate perception is, the initiative may create rent seekers who will exploit the immediate shortage of such accredited counsellors.”

Meanwhile, Eminent Economist VK Suri told KNN that although quite late but the move is welcome.

“It is good step. RBI should accredit counsellors to advice the entrepreneurs whether to take the loan or not,” Suri said. (KNN Bureau)