SIDBI inks pact with LIC to boost start-ups and MSMEs

New Delhi, Apr 8 (KNN) The Small Industries Development Bank of India (SIDBI) has inked pact with Life Insurance Corporation of India (LIC) to boost start-ups and MSMEs in the country.

SIDBI has signed a Memorandum of Understanding (MoU) with LIC for supplementing funds under its Fund-of-Fund operations for the Venture Fund industry.

CMD of SIBDBI, Kshatrapati Shivaji, while addressing the SIDBI start-up conclave on Thursday said the MoU was executed with LIC for contributing to the corpus of MSME focused venture capital funds along with India Aspiration Fund (IAF) being managed by SIDBI.

“SIDBI is addressing the gaps in MSME ecosystem,” he added.

As part of its Fund-of-Fund operations, SIDBI has set up IAF with a corpus of Rs 2,000 crore pursuant to budget announcement of 2015.

LIC will be contributing up to 10 per cent of the Fund size of IAF to be managed by SIDBI, said LIC CMD K Roy

Jayant Sinha, Minister of State for Finance said that the initiative will augment the sources of domestic capital to support venture funds with focus on startups as currently most of the capital comes from overseas which can lead to volatility.

Sinha said that the country needs to be at the forefront on innovation and consequently the centre has set up a Fund with an initial corpus of Rs 2,500 crore and a total corpus of Rs 10,000 crore over a period of four years.