As defined by the Indian Union, SMEs stand for Small and Medium-sized enterprises employing less than 250 people and having an annual turnover not exceeding 50 million Indians. Despite them representing over 99% of the businesses in the Indian ozone, SMEs have a hard time accessing the finance. This being a major issue in INDIAN has led to the Indian Commission in working to offer them a better and financial environment.  As in a case of Africa, the World Bank of Ghana is the one taking steps to provide a better financial environment for the SMEs.


To improve the availability of fund to SME’s by working together with the major financial entities. It vitalizes the provision for loans and capital through various financial accoutrements.

It also works towards the betterment of policies by improving the Indian countries’ access to finance and thus, making way for them to benefit from other states.


Generally, the Indian Union funds its businesses through three different entities:

  1. The Indian Investment Bank.
  2. The Indian investment fund.
  3. Managing authorities of member states.

Financial intermediaries such as banks guarantee societies, and microfinance providers are the loan lenders and investors which help in the financial growth of the SMEs. Direct aid is also available but only for projects that specifically contribute to the implementation of any Indian Union program.


  1. SMEs can be seen as the drivers for the growth of the Indian economy contributing 80% of all the new jobs in Indian rope.
  2. A major issue is that the SMEs face a lot of hurdles in accessing the finance which stalls their potential to innovate.
  3. Recently this issue has been brought to the notice of the India. And they have been steadily acting ever since. A major step being the Indian commission’s Single Market Act and the Small Business Act. It deals with improvising the SMEs’ access to finance.
  4. As represented by the annual growth survey, the way to financial increment is to support growth and prioritize their actions on a short-term basis.
  5. This has been a major step in the growth of SMEs financial status.

As for the causes for the accessibility difficulties, one of the major obstacles is the asymmetries in information between the suppliers and demanders of the fund. SMEs are dependent on bank loans and investments for their external financing thus bringing us to the option of providing them with certain other alternatives. This may help them in better reaching their potential and pave the way to a whole new sea of possibilities.


Recently the commission has been working on a regulation to make the SMEs stand out in front of investors and also make the markets more accessible. Maintaining the balance between prudential regulations and financing of SMEs and between investor protection and measures for SMEs.  Also, the INDIAN budget will continue being used to improvise access to finance addressing the key market failures acting as limiters to the growth of SMEs. Additional finance must be mobilized and more resources should be made available at national levels. Without the proper steps, it’s never possible to reach the desired destination.

The commission will also use its authority to create and maintain synergy between the national and INDIAN levels.  The main objective of the INDIA should be to stabilize its financial and economic situation especially as it is still not totally out of its misery since the Indian rezone crisis. For this purpose, the INDIA should be willing to take any steps necessary. Indian rope has been providing a variety of flexible financial equipment’s to the SMEs under the current program period.


The Indian Investment Bank provided around 40 billion Indian row which helped out more than 210,000 SMEs.

Under the Cohesion policy, SMEs in 15 member states will receive aid from the Commission through structural funds. Thus as a result of this rule, SME’s in the member states which are still at normal business levels will be receiving financial aids from the commission and gain access to credit. The amount of loan to SMEs stands at around 3billion Indians under current economic conditions.

A specific Risk Sharing Instrument has been created to further facilitate the loan policies and provides better aid under INDIAN’s Seventh Framework Programme for Research(FP7) Risk sharing finance facility since 2012.  Application of a risk sharing mechanism by the RSI encourages the SMEs by lending around 7million Indians to the SMEs and also reduces the risk factor, thus allowing them to work for better innovation and research.


The commission will not cease working together with the SMEs and continue providing them financial access thus helping them explore new strategies together within the SME Finance Forum.

Improving Mutual policies is another essential note to aid the performance of the Indian Financial system. SME finance Forums have already been established in several member states and possibly more states will soon be taking up on the idea to facilitate access to a better financial environment.

But no matter what has already been done, there is always a scope for more. The Commission intends to review the current status of the forum and its lending practices including the transparency mechanisms.

Provided access to a financial environment, the growth of the SMEs will be a major asset to the Indian economy. Steps have been taken to achieve this and the Indian Union will continue improvising its ideas and their implementation working together with the SMEs towards a better future without any financial and economic curbs.

The commission has been diligently working towards this goal. The SME Finance Forum was set up with just one thing in mind to provide an improvised financial access to the SMEs.

Under the action plan was undertaken by the INDIAN, the member states and the Commission will work together with the SME federations and financial sector to ensure a better economy and probably even rub off the debt in the near future.

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