Staff Reporter

No steps to propagate schemes for small-scale entrepreneurs, says Salem association

RBI instructions not carried outFinancial assistance not advanced up to Rs. 25 lakhsHuge amount spent on conducting melasFinance Minister thanked for Ombudsman Scheme

SALEM: The Salem District Small Scale and Tiny Industries Association has alleged that the nationalised and scheduled banks in the district hesitate to provide loans to small-scale entrepreneurs without collateral security.

Special meeting

In a letter to Finance Minister P. Chidambaram, the president of the Association K. Mariappan said that none of the nationalised and scheduled banks was advancing financial assistance up to Rs. 25 lakhs to the first generation of small-scale entrepreneurs without collateral security as per instructions of the Reserve Bank of India (RBI).

As a result, the entrepreneurs were driven from pillar to post to obtain loans.

The District Collector convened a special meeting recently to discuss the issues Participating in the meeting, the Assistant General Manager of Small Industries Development Bank of India (SIDBI), Chennai, explained that the integrated tie-up scheme of the SIDBI with various banks for re-financing up to Rs. 25 lakhs to meet the capital investment and working capital requirements of entrepreneurs. But banks in the district were not implementing this scheme also.

Mr. Mariappan said the banks were conducting a mela to provide housing and vehicle loans. They were spending large amount to promote such loan melas.

But hardly any bank in the district initiated steps to propagate their loan schemes for small, medium and tiny industries among entrepreneurs.

The Finance Minister should look into these issues and take efforts to meet loan requirements of small and medium enterprises.

Move welcomed

However, the Association welcomed the Ombudsman Scheme formed to redress public grievances regarding banking transactions. It thanked the Finance

Minister for launching the scheme facilitating the people to register their complaints regarding the banking services including the delay in the sanctioning of loans.