JAMMU: Reserve Bank of India organised a Town Hall Meeting for existing and prospective Micro, Small and Medium Enterprises (MSME) entrepreneurs at Srinagar on Monday. Town Hall meets are periodically organised by RBI to create awareness of banking facilities amongst the entrepreneurs, link the unbanked entrepreneurs to the formal banking channels and to create a platform for two-way communication amongst the stakeholders.
The meeting was chaired by General Manager, RBI, Jammu, A K Mattu. Besides, President J&K Bank, Abdul Rashid Sheigan, Vice President SLBC, Rakesh Gandotra, DGM, OBC, P R Toofan, other senior bankers from SBI, PNB, Canara bank, ICICI, EDB, JKGB and officials from government departments also participated and interacted with the entrepreneurs.
Representatives from KCCI, FCIK, Houseboat Owners Association, Traders and Manufacturers Association, Kashmir Youth Entrepreneurs Association, Hoteliers Association also participated in the event.
According to an official handout, Mattu explained the huge potential of this sector in employment generation and contribution to the overall economic growth of India and informed how it had transformed the economic landscape of countries like UK, US, Germany, France, Taiwan, Italy and Canada where its contribution to respective employment generation and GDPs ranged from more than 50% to 90%, whereas in India the position was much lower. Therefore, it held a huge potential if promoted properly by creating a congenial and conducive climate.
India had a huge population of young persons but all could not be absorbed in the employment and with agriculture sector offering limited scope for employment, the answer to our unemployment and overall economic growth lied only in the growth of MSME sector, which the Government of India and RBI were very keen to promote and the present Town Hall event was a step in that direction, the handout read.
Mattu pointed out that Information asymmetry, was one of the serious impediments in ensuring adequate and timely lending to this sector and lack of financial literacy among the entrepreneurs was observed to be one of main culprits and, therefore, financial literacy was essential for effective money management and proper understanding of various products and services by the entrepreneurs.
The MSME entrepreneurs were also constrained by lack of operational skills, accounting and finance acumen, business planning, etc. which underscored a need for facilitation by banks and other agencies. Quoting IFC, World Bank and other reports of RBI & Ministry of MSMEs, GOI, he pointed out that there was an unmet credit gap to the tune of INR 14.9 trillion in 3.04 crore units as on March, 2016. Thus, banks had tremendous responsibility and opportunity to tap this gap as a sound business proposition.
Presentations on RBI initiatives on MSME sector highlighting salient guidelines, regulation, incentives and other recent developments; status of MSMEs funding in the state of Jammu and Kashmir and features of CGTMSE scheme were made by AGM, RBI, Satish Sharma and Vice President, SLBC and SIDBI representative, Rakesh Gandotra, respectively.
A question-answer session was also held in which participants raised various questions which were replied to by the bankers/RBI/SLBC. The overall discussions and the issues covered were very well received and appreciated by the entrepreneurs.