Andhra Bank and State Bank of Hyderabad (SBH), the two Hyderabad-headquartered public sector lenders, have promised to provide timely and adequate credit to small and medium enterprises (SMEs) at a bankers conclave held here on Saturday.
SBH has gone a step ahead and declared 2003-14 as the SME year and offered to bring down interest rates to the small businesses. "We will target 60 per cent growth in the SME portfolio next year," said M Bhagavantha Rao, managing director of SBH, while addressing the seminar.
The bank has already brought down the interest rates to SMEs under seven sectors to 11.75 per cent, he said while stating that the management is considering similar relief to more sectors in this bracket.
Andhra Bank chairman and managing director BA Prabhakar said the bank's SME lending this year is expected to post a 25 per cent growth and the sector would continue to be a priority area in the future as well.
"We are pushing more credit to the SME sector also because the large corporates have not been able to absorb the credit," he said. Andhra Bank lending to the SME sector stands at Rs 14,000 crore, which constitutes 20 per cent of the total loan portfolio of the bank, according to him.
Andhra Bank has opened a branch at Madapur in the city to exclusively fund new entrepreneurs with innovative ideas. "This is a new area where we will be financing the business ideas. We will finance the ideas," Prabhakar said.
Sanjaya Baru, director, International Institute for Strategic Studies, in his keynote address said a sustained partnership between the banks and the entrepreneurs is a key to the success of SMEs in the country.