The government has launched a 59-minute loan platform that enables easy access to credit for MSMEs
SIDBI has started lending to companies directly instead of through banks
Changes have been observed in the existing schemes for startups and MSMEs
India today is home to more than 39K startups. The Indian startup ecosystem is producing unicorns at double the speed than before, with multi-billion dollar fundings from global investors, and celebrating high-profile exits such as the $16 Bn Walmart-Flipkart acquisition last year. At the same time, the country’s micro, small, and medium enterprises (MSME) sector comprising 577 Cr companies is beating challenges of setting up and building the consumer base, among others.
But an idea remains an idea if it does not get the requisite working capital on time. According to reports, less than 5% of MSMEs have access to formal credit, while others rely on informal sources to fund their businesses. For Indian startups, while there are a number of private equity and debt funding options available, to get funding at the idea or early stage is a challenge.