IDBI Bank & EXIM Bank sign MOC for Co-financing of Export-Oriented Companies

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IDBI & EXIM Bank sign MOC for Co-financing
IDBI Bank Ltd has entered into a Memorandum of Cooperation (MOC) with EXIM Bank, wherein IDBI Bank and EXIM Bank would, inter alia, co-finance, co-arrange, syndicate rupee and foreign currency loans, jointly finance export-oriented projects in India, provide/avail refinance facility in Indian Rupees and/or Foreign Currency for extending short term export credit and long term capex loans to eligible export-oriented companies, particularly in the SME sector.

IDBI Bank and EXIM Bank would also co-operate in promotional activities, provide advisory services to assist each other's clients and co-operate in training of each others' staff members.

Speaking on the occasion, Shri R M Malla, Chairman and Managing Director, IDBI Bank Ltd said "This would be a win-win situation for both the organizations for meeting the credit requirements of export oriented companies, particularly in the SME sector.

IDBI Bank will continue to play a pioneering role in promoting development of this great nation and its people. IDBI Bank has a large portfolio of MSME sector units and is desirous of expanding its lending to this sector in view of the fact that the MSME sector is a key driver of Indian economy in terms of contribution to GDP, employment and exports. The Memorandum of co-operation with EXIM Bank would help IDBI Bank in increasing its reach to MSME Sector".

Shri T.C.A. Ranganathan, Chairman and Managing Director, EXIM Bank, said "EXIM Bank believes in partnership, collaborations, especially with forward-looking commercial banks. EXIM Bank's approach has been to provide a holistic solution within its mandate to the MSME sector rather than just being a purveyor of credit.

To achieve this objective, EXIM Bank has undertaken various capacity building initiatives through Grassroots Initiative and Development (GRID) and Export Marketing Services. EXIM Bank has arranged for a credit line from the Asian Development Bank (ADB) for providing foreign currency term loans to the MSME borrowers in certain specific lagging states of India.

As part of the strategy towards augmenting the competitiveness of MSMEs and with a view to facilitating credit flow to the MSME sector at competitive rates, EXIM Bank has put in place a Technology and Innovation Enhancement and Infrastructure Development (TIEID) Fund exclusively for MSMEs by partnering with commercial banks/FIs.

TIEID seeks to meet long term foreign currency loan requirements of Indian exporting entities in the MSME sector for meeting eligible capital expenditure, through refinancing of commercial banks/FIs against their eligible MSME financing portfolio.

In addition to long-term refinance under TIEID, EXIM Bank is also offering short-term export credit refinance in foreign currency. Export credit in foreign currency offered to the MSME units by other FIs/commercial banks will be refinanced by EXIM Bank".

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