Coimbatore is bustling with activity
Finance ministary and Reserve Bank directives on small and medium enterprise (SME) lending are no more falling on deaf years.Public sector banks seem to be gung-ho on lending to SME clusters, especially those in the southern region. The Coimbatore region of Tamil Nadu has emerged as a manufacturing hub. In fact, Corporation Bank has already loaned out Rs 1,500 crore in 2006-07 to almost 1,000 SMEs in the region. From poultry feed to textiles, the region is bustling with activity. Even though the lending network in the region has been on a rise in the past year, realisations have gone down by 10% for exporters with the depreciating rupee.While a major chunk of the Rs 450 crore in total advances have gone to textile and garment makers, engineering goods makers are not far behind at Rs 350 crore. About Rs 150 crore has been loaned to small and medium players in the poultry segment and the remaining Rs 550 crore has gone to other activities, including auto ancilliaries, lorry and bus-building units, agrofarm machinery and farmequipment makers. ‘‘The need for funding is only going up and we are planning to target a Rs 2,000-crore exposure in the next 24 months,’‘ a senior manager of Corporation Bank told.
In fact, there is a need for setting up an SME corridor, given the activity in the region, so as to attend to the needbased loan requirements of SMEs. More than 1,000 SMEs have been covered in the Coimbatore region, which is one of the highest in the southern region. The centres, which have maximum potential for development and capacity enhancement, are Karur, Tirupur, Erode, Namakkal, Tirunelvel, Palayam Kottai, Tuticorn, Nagercoil, Madurai and Didugal. Seeing the off-take, Corporation Bank has offered to give a 0.5% rebate on loan interest to those small and medium enterprises that have been credit-rated under the SMERA (SME Rating Agency of India), which is a joint initiative by SIDBI, Dun & Bradstreet Information Services (D&B), Credit Information Bureau India(CIBIL) and few other Indian banks.
