Credit and Finance for MSMEs: India’s biggest private lender HDFC Bank on Monday launched an overdraft facility for smaller retailers in partnership with the government’s e-governance services delivery arm CSC SPV that enables government schemes and services by means of frequent service centres (CSCs). The ‘Dukandar Overdraft Scheme’ by HDFC Bank is aimed at assisting shopkeepers and merchants ease their money crunch. According to the bank, retailers operating for a minimum of 3 years are eligible for the scheme by offering six months bank statement from any bank. HDFC Bank will approve an overdraft limit from a minimum of Rs 50,000 to a maximum of Rs 10 lakhs based on the statements. Importantly, HDFC Bank will not seek collateral safety, enterprise financials, and revenue tax returns from retailers who apply for the scheme.
“The new scheme has been created keeping in mind the current situation of small traders. The upper limit for shops operational for less than 6 years is Rs 7.5 lakhs and Rs 10 lakh for establishments which have been in business for more than 6 years,” HDFC Bank stated in a statement. The scheme presents a commission of .40 per cent to .80 per cent for loan amounts of Rs 5 Lakhs and above for village level entrepreneurs (VLE) along with more than 600 branches and virtual relationship management assistance.
Subscribe to TheSpuzz SME newsletter now: Your weekly dose of news, views, and updates from the world of micro, smaller, and medium enterprises
“The prevailing conditions have been particularly harsh on small businesses. HDFC Bank together with CSC has launched this initiative to sustain these small retailers, to help motivate them and create better business opportunities. We at HDFC Bank are trying to create supportive schemes to help businesses get back on their feet before the start of the festive season,” stated Smita Bhagat, Country Head – Government and Institutional Business, HDFC Bank in a statement. Dinesh Tyagi, Managing Director at CSC SPV stated that the scheme is a sensible supplying, particularly through these challenging and uncertain occasions for smaller shopkeepers and enterprises and our VLEs alike.
HDFC Bank, as portion of the member lending institutions of the Emergency Credit Line Guarantee Scheme (ECLGS), had disbursed about Rs 23,000 crore as of December 31, 2020. “HDFC Bank ranks amongst top banks in terms of extension of credit under the ECLGS scheme which stood at around Rs. 23,000 crore as of December 31, 2020,” the bank had stated in a statement. According to a PTI report, HDFC Bank’s Aditya Puri was the highest-grossing banker amongst the leading 3 private-sector lenders in his retirement year (FY21) with total emoluments of Rs 13.82 crore.