HDFC Bank assists young entrepreneurs under govt. SME development initiatives

Inline with the policy objectives by the government, the HDFC bank has implemented various initiatives in the recent past in order to enhance the availability of financial facilities for SMES in the country.

Under Self-employment Promotion Initiative (SEPI) loan scheme the bank had been able to provide financial assistance to start self-employment projects by trained youth who pass out from vocational training institutions that come under the purview of the Ministry of Skill Development and Vocational Training (MSDVT).

Though the trainees gain knowledge and skills in different technology areas and are fully competent, it is difficult for them to find a job since most of the industries are located in urban areas. Lack of financial facilities is also a major barrier for emerging entrepreneurs who wish to commence their own ventures.

Hence, the SEPI is designed to provide financial assistance to trained youth who have completed the courses from recognised vocational training institutes, for the establishment of their own self-employment projects.

As a public private partnership bank with the majority 51 percent shares held by the state has accepted responsibility to support the government’s economic policies for income generation and employment creation. In this context, HDFC has made notable contributions towards promotion of young entrepreneurs. HDFC Bank is the second largest credit disbursing bank under the SEPI loan scheme in the year 2017. According to the MSDVT information as at December 31st 2017, HDFC Bank was able to finance 36 youths in various part of the country to the value of Rs.16,250,000.

Central Bank Governor Dr. Indrajith Coomaraswamy recently requested the banks to consider MSME loans to young entrepreneurs and emphasised that it was the bank’s collective responsibility to help young entrepreneurs to commence or improve their businesses, making them financially Inclusive.

This loan scheme covers categories of agriculture, industrial, information technology, automotive, construction, electronic and telecommunications, food, refrigeration and air conditioning, farm machinery, digital imaging and printing, jewelry designing and manufacturing, welding and fabrications sectors and other innovative areas.

HDFC Bank expects to further strengthen the credit disbursement in 2018 and fulfill the financial needs of the youth who have undergone a professional training in specific fields through vocational training institutions, to start their own enterprise.

Through the product diversification strategy, the bank has introduced a range on financial products and services, in addition to the bank’s core business of housing finance. These new products have opened up additional revenue streams for the bank.

In an event of scarcity of refinance in the CBSL credit schemes, bank has introduced similar features of credit scheme through the bank’s own funds.