There are a num­ber of credit rat­ing agencies in In­dia, and be­ing rated by one or more of them can help a busi­ness to grow. Some of the pop­u­lar credit rat­ing agencies are CRISIL, SMERA and ONICRA.

Says Amit Ramb­hia, CEO, Vard­haman Tech­nol­ogy, Mum­bai, which has a CRISIL rat­ing, “The rat­ing helped us to ne­go­ti­ate bet­ter with our bankers for an over­draft and other busi­ness loans, and also helped us to get bet­ter credit from our for­eign sup­pli­ers.”

Typ­i­cally, a rat­ing helps part­ners to get bet­ter in­ter­est rates—which could be 0.5-1.5 per­cent lower than the pre­vail­ing in­ter­est rates—from fi­nan­cial in­sti­tu­tions. The an­nual cost of get­ting a credit rat­ing varies from less than ` 50,000 to ` 110,000 based on the size of the com­pany. Most credit rat­ing agencies also of­fer dis­counts on their fees, and part­ners can al­ways ne­go­ti­ate it.

“Many cus­tomers give im­por­tance to a CRISIL rat­ing,” as­serts Neel Shah, Di­rec­tor, In­sight Busi­ness Ma­chines, Mum­bai. “That’s be­cause a CRISIL rat­ing proves that the part­ner and its pro­mot­ers have en­gaged trans­par­ently to open its books and documents which an or­ga­ni­za­tion with short term vi­sion will not.”

An­other use­ful move is to get reg­is­tered with the Min­istry of Small & Medium En­ter­prises (MSME). In­forms Kshi­tij Kotak, CEO, For­tune Gr­ey­cells, Mum­bai, “It typ­i­cally costs be­tween ` 3,000 and ` 5,000 if you ask your CA or an agent to get you reg­is­tered. If you are do­ing it all by yourself you pay less than ` 500.”

The ben­e­fits of MSME reg­is­tra­tion are sev­eral. “If you are ad­dress­ing the govern­ment sec­tor, in many cases your Earnest Money De­posit amount is waived. The cost of ten­der documents, which in most cases is above ` 5,000, is also waived,” says Shah.

Apart from these ben­e­fits, the Small In­dus­try De­vel­op­ment Bank of In­dia (SIDBI) of­fers very at­trac­tive un­se­cured loans for com­pa­nies en­gag­ing in man­u­fac­tur­ing or ser­vices at in­ter­est rates as low as 12.5 to 15 per­cent.

Many cus­tomers give im­por­tance to CRISIL rat­ing, be­cause it proves that the part­ner has en­gaged trans­par­ently to open its books which an or­ga­ni­za­tion with short term vi­sion will not


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