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MSME Financing Market in India 2020

  • ID: 5125434
  • Report
  • June 2020
  • Region: India
  • 89 pages
  • Netscribes (India) Pvt Ltd
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FEATURED COMPANIES

  • Axis Bank Limited
  • Bajaj Finserv Limited
  • Central Bank of India
  • Federal Bank Limited
  • HDFC Bank Limited
  • ICICI Limited
  • MORE
Micro, small and medium enterprises (MSMEs) play a pivotal role in the Indian economy. About 63.38 Mn enterprises operational in various industries have provided employment to more than 111 Mn people. The MSME sector accounts for 30% of the country’s GDP, which is likely to touch 50% in 2025. The industry's financing needs depend on the nature, size, customer segments and stage of development of the different businesses. Financial institutions have limited their lending exposure to the Indian MSME industry due to the high cost of service, small ticket size of loans and limited ability of MSMEs to offer immovable collaterals.

As of 2019, the overall addressable demand for external credit was ~INR 41.64 Tn, while the total supply of fund stood at INR 13.54 Tn.
Therefore, the credit gap in the MSME industry accounted for ~INR 28.10 Tn in 2019.

Debt demand of the MSME sector in India:

The consolidated debt demand (both short-term and long-term finance) by Indian MSMEs accounted for ~99.39 Tn in 2019. Microenterprise debt demand accounted for INR 13.32 Tn, small enterprise accounted for INR 24.57 Tn, and medium enterprise accounted for INR 3.75 Tn of the total debt demand in the industry. Medium and small firms being more formalized in operations are better at securing collaterals with NBFCs and banks than micro-enterprises.

Credit supply to the MSME sector in India:

The overall credit supply, including both the formal and the informal sectors, is worth INR 86.08 Tn. The formal and the informal sectors contribute ~INR 13.54 Tn and INR 72.54 Tn, respectively to the overall credit supply. Banking and other financial institutions account for ~INR 11.68 Tn of the overall formal finance supply to the Indian MSME industry.

Credit gap in the MSME sector in India:

The overall credit gap is estimated to be ~INR 28.10 Tn, which can be attributed to underserved micro and small units. Further, lack of awareness among entrepreneurs about the various loan products and lack of proper documentation have considerably reduced the supply of debt.

Impact of COVID-19:

Small businesses are the most vulnerable to an unexpected crisis like COVID-19 because of their size, scale of business operation and limited financial management resources. However, the government has announced several policy measures to minimize the losses.

The announcement of a targeted long-term repo operation (TLTRO) of INR 500 Bn, a grant of INR 3 Tn collateral-free automatic loans, INR 200 Bn subordinated debt to stressed MSMEs, and a complete ban on global tenders for procurement of goods and services for up to INR 2 Bn are a few of the crucial policy mandates.

Companies Covered::
  • Axis Bank of India
  • Bajaj Finserv Limited
  • Central Bank of India
  • Federal Bank Limited
  • HDFC Bank Limited
  • ICICI Limited
  • Kotak Mahindra Bank Limited
  • State Bank of India
  • Union Bank of India
  • Utkarsh Micro Finance Bank
Note: Product cover images may vary from those shown
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FEATURED COMPANIES

  • Axis Bank Limited
  • Bajaj Finserv Limited
  • Central Bank of India
  • Federal Bank Limited
  • HDFC Bank Limited
  • ICICI Limited
  • MORE
Chapter 1: Executive summary

Chapter 2: Socio-economic indicators

Chapter 3: Introduction
3.1. Market definition and structure

Chapter 4: The MSME sector in India
4.1. Number of MSMEs in India - activity-wise split
4.2. Number of MSMEs in India - rural vs urban split
4.3. Number of MSMEs in India - activity-wise rural vs urban split
4.4. Number of MSMEs in India - based on registration
4.5. Top five industries of operation
4.6. Number of MSMEs in India - category-wise
4.7. Employment in the MSME sector in India - activity-wise
4.8. State-wise distribution of MSMEs in India

Chapter 5: Debt demand of the MSME sector in India
5.1. Debt demand by the MSME sector in India (2019) (INR Tn)
5.1.1. Debt-equity split
5.2. Addressable debt demand by the MSME sector in India (2019) (INR Tn)
5.2.1. Overall debt demand exclusions
5.3. Addressable debt demand based on the size of MSME sector in India (2019) (INR Tn)
5.4. Addressable debt segment as a percentage of number of enterprises
5.5. Addressable debt demand based on type of enterprise (2019) (INR Tn)
5.5.1. Addressable debt demand of top manufacturing sectors (2019) (INR Tn)
5.5.2. Addressable debt demand of top service sectors (2019) (INR Tn)
5.6. Addressable debt demand based on geography

Chapter 6: Credit supply to the MSME sector in India
6.1. Supply of debt to the MSME sector in India (2019) (INR Tn)
6.1.1. Supply of informal debt to the MSME sector in India (2019) (INR Tn)
6.1.2. Supply of formal debt to the MSME sector in India (2019) (INR Tn)
6.2. Debt supply to MSME segments in India (2019) (INR Tn)
6.2.2. Debt supply to manufacturing and service sectors (2019) (INR Tn)
6.3. Debt supply based on geography

Chapter 7: Credit gap in the MSME sector In India
7.1. Overall credit gap (2019) (INR Tn)
7.2. Credit gap based on type of enterprise in India (2019) (INR Tn)
7.3. Credit gap based on type of enterprise (2019)(INR Tn)

Chapter 8: Impact of COVID - 19
8.1. Impact of COVID - 19
8.2. Relief packages

Chapter 9: Market trends
9.1. Market trends

Chapter 10: Market influencers
10.1. Market drivers
10.2. Market challengers

Chapter 11: Supportive growth environment
11.1. Supportive growth environment

Chapter 12: Competitive landscape
12.1. Product benchmarking
12.2. Axis Bank Limited
  • Company information
  • Business description
  • Products/services
  • Key people
  • Financial snapshot
  • Key ratios
  • Key financial performance indicators
  • Key business segments
  • Key geographical segments
Note: Similar information covered for all other public companies. Private companies' data given on best effort basis.
12.3. Bajaj Finserv Limited
12.4. Central Bank of India
12.5. Federal Bank Limited
12.6. HDFC Bank Limited
12.7. ICICI Limited
12.8. Kotak Mahindra Bank Limited
12.9. State Bank of India
12.10. Union Bank of India
12.11. Utkarsh Small Finance Bank

Chapter 13: Potential interventions in the MSME credit ecosystem
13.1. Potential interventions in the MSME credit ecosystem

Chapter 14: Recent developments
14.1. Recent developments

Chapter 15: Appendix
15.1. Acronyms
15.2. Research methodology
15.3. About the Publisher
15.4. Disclaimer
Note: Product cover images may vary from those shown
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  • Axis Bank Limited
  • Bajaj Finserv Limited
  • Central Bank of India
  • Federal Bank Limited
  • HDFC Bank Limited
  • ICICI Limited
  • Kotak Mahindra Bank Limited
  • State Bank of India
  • Union Bank of India
  • Utkarsh Small Finance Bank
Note: Product cover images may vary from those shown
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