SME – RTN asia

RBL Bank and NeoGrowth Credit Pvt will provide loans to small and medium enterprises in the Indian retail segment that are excluded from mainstream funding and financing with the help of a US government agency. The funding will be backed by the Overseas Private Investment Corporation (OPIC) -- a US Government organization that mobilizes private capital "to help solve critical development challenges" and advance U.S. foreign policy objectives. OPIC will provide a $5 million loan guarantee to RBL Bank, which will in turn fund NeoGrowth. NeoGrowth, a non-banking finance institution, will lend to Rs 2 lakh to Rs 75 lakh to the retail SMEs. NeoGrowth targets SMEs which do not get loans easily from commercial banks owing to their small size, inadequate credit history and lack of collateral. Piyush Khaitan, Founder and Managing Director of NeoGrowth said, “Over 50% of small businesses in India are denied credit using traditional credit-assessment, and NeoGrowth reaches out to them. Enabling first-time borrowers and women entrepreneurs is an area of special focus for NeoGrowth” "We were wondering how to mobilise additional resources to lend to our customers, and the OPIC loan guarantee backed arrangement with RBL Bank will help extend our reach and serve many more customers," Piyush added. Elizabeth L. Littlefield, OPIC President and CEO said, “In the retail sector in India, many small businesses can’t simply go to a bank and get a loan – their businesses aren’t large enough or don’t have a credit history. With the help of OPIC and RBL Bank, NeoGrowth will use its innovative technology to invest in these small retail businesses, helping them to grow and thrive.” Vishwavir Ahuja, Managing Director and CEO of RBL Bank said, “We are happy to partner with OPIC, one of the world’s leading development financial institutions, in further expanding our existing relationship with NeoGrowth. As a bank, we have stayed focused on serving the needs of India’s growing SME sector, especially the emerging segments including organised retail, e-commerce, logistics and consumer services. This financing structure —leveraging OPIC’s strengths and RBL Bank’s India expertise — will enable NeoGrowth to steadily lend to industries and segments that have good growth potential and enable these entities to grow to the next level.” RBL Bank Ltd is one of India's private sector banks established in 1943, having presence across the country with 201 branches and 373 ATM's spread across 16 Indian states and union territories.

Tag: SME

US Govt agency to help disburse loans to Indian SMEs