Credit flow to small units to double in 5 years: PM

The flow of bank credit to the micro, small and medium enterprises (MSMEs) is expected to double in the next five years, prime minister Manmohan Singh told a meeting of SSI units in New Delhi today.

He was addressing participants at the presentation of national awards to micro, small and medium enterprises.

He said loans outstanding to MSMEs from the public sector banks have already recorded a near 25 per cent growth in the last one year.

While some of the banks have done commendable jobs, the prime minister said, other banks should also ensure higher flow of funds to these enterprises.

"Greater availability of credit can contribute to the faster modernisation and expansion of these enterprises and the augmentation of their productivity and competitiveness. I would urge MSMEs to also explore new and emerging sources of finance such as venture capital and private equity," he said.

The prime minister said the government was working on a proposal to give the MSME sector one-stop access to facilities for capacity building, quality improvement, skill development, credit and marketing support. This would enable them to execute their projects speedily and with better results.