New Delhi: Mr. Sanjay Aggarwal, President, PHD Chamber, while exchanging the MOU, stated that Credit Rating is very important for the MSMEs wanting to raise finance and credit from various sources. Of all the problems faced by the MSMEs, non-availability of timely and adequate credit at reasonable interest rate is one of the most important discussions today. He mentioned that one of the major causes for low availability of bank finance to this sector is the high risk perception of banks in lending to MSMEs and consequent insistence on collaterals which are not easily available with these enterprises. The problem is more serious for micro enterprises requiring small loans and the first generation entrepreneurs. Further, the Banks and other funding institutions need adequate comforts by way of not only the assessment of credit worthiness of borrowers, but also collaterals. The problem is that the number of companies which can meet these criteria is very low. While manufacturing units can mortgage their equipment against loans, service-oriented MSMEs are unable to do so, posing a challenge for them to avail finance in order to grow and scale up.
He therefore highlighted the importance of credit rating which decides whether a borrower does or does not receive a loan. Good credit ratings allow people, companies, and governments to easily borrow from Banks/financial institutions or public debt markets. Since the Banks and other funding organizations are giving enough weightage to Credit Rating and have made it mandatory for credit limits beyond a certain amount, it is good that PHD Chamber has worked out an arrangement with India Ratings to facilitate Rating services at concessional rates for the members.
Mr Rajesh Patel, Chief Operating Officer, India Ratings and Research apprised the participants about their services and requested the members to get their companies rated.
Mr Anil Khaitan, Former President & Mentor, PHD Chamber and Chairman, in his address, highlighted the various innovative sources of raising finance and advised members not to divert their long term loans to meet the short term needs and vice-versa to maintain a healthy working capital cycle.
Mr Ramesh Kumar Jain, Chairman, HP State Chapter, PHD Chamber; Dr H P Kumar, Former CMD, NSIC and Advisor, PHD Chamber; Dr Ranjeet Mehta, Deputy Secretary General, PHD Chamber; Mr Neermoy Shah, Head Mid-Corp Analytical for North and East, India Ratings and Research; Mr Rakesh Khurana, Regional Manager, National Stock Exchange, and Mr Narender Bhardwaj, Co-chairman, HP State Chapter, PHD Chamber also addressed the conference.