Yes Bank and the Small Industries Development Bank of India (SIDBI) today announced the launch of an alliance that focuses on small and medium enterprises (SME). The alliance, termed 'Yes SIDBI- expertise for small and medium businesses' aims to furnish a one-stop-shop of sorts that provides a comprehensive range of financial products and services for SME customers.
The initiative will be rolled out from Gurgaon, which has been identified as one of the main 'cluster areas' for SMEs. From there on, the service will be introduced in other parts of the country.
The Yes-SIDBI alliance is the first initiative of its kind between a private and public bank. SIDBI already has similar tie-ups with two public sector banks - Bank of India and UCO bank. Yes Bank will combine its advisory services and technological assistance with SIDBI's SME initiatives.
Addressing the press in Mumbai this afternoon Rana Kapoor, CEO and managing director, Yes Bank, said that the venture came about as an initiative to ameliorate conditions for SME customers who have had to face not only problems of approaching different banks for different purposes, but also lack of technological facilities and knowledge base regarding trends in business, adversity of information regarding investment opportunities etc.
N Subramanian, chairman and managing director, SIDBI, said that the venture reflected SIDBI's vision of a 'bank within a bank' giving SME customers the option of accessing a wide range of financial products and services, all under one roof.
The facilities to be provided under this venture are term loans, working capital, guarantees, letters of credit, foreign exchange, cash management, investment products, insurance, internet banking, ATM facilities, phone banking and also advisory based on customer assessment.
The venture is currently focusing on the SME areas like garments, auto and IT enabled services. Kapoor said he hoped to have the venture working in at least 20 of SIDBI and Yes Bank's centres by the end of one year. The alliance has targeted Rs 100 crore worth incremental loans for the SME sector this year through this venture.