Kreditanstalt fur Wiederaufbau (KfW), a German development bank, recently loaned a total of EUR 100 million (USD 130 million) to Small Industries Development Bank of India (SIDBI), a state-owned bank, for on-lending to micro-, small and medium-sized enterprises (MSMEs) in India. As loan funds are often more available to large organizations or in tiny amounts, the funding is intended to address the “missing middle” segment by disbursing retail loans between the amounts of INR 50,000 (USD 820) and INR 1 million (USD 16,000) [1]. Further details on the loan and financing agreement are unavailable.
As of 2011, KfW reported total assets of EUR 495 billion (USD 642 billion) and a commitment to developing and transition countries totaling EUR 70.4 billion (USD 91.5 billion). As of March 2012, SIDBI reported total assets of INR 594 billion (USD 10.9 billion).
By Meghan Gillis, Research Associate
About Small Industries Development Bank of India (SIDBI)
Established by the Indian Parliament in 1990, the Small Industries Development Bank of India (SIDBI) offers products and services in areas including direct finance, international finance, government subsidy and fixed deposits. Its clients include financial institutions, investors and entrepreneurs. SIDBI participates in the Indian microfinance sector by providing credit and capacity building grants to large- and medium-scale microfinance institutions. As of March 2012, SIDBI reported total assets of INR 594 billion (USD 10.9 billion).
About Kreditanstalt fur Wiederaufbau (KfW)
Formerly the known as the KfW Bankengruppe, Kreditanstalt fur Wiederaufbau (KfW) is a German development bank with the objective of supporting economic, social and ecological development worldwide. Owned by the Federal Republic and the Länder (federal states), it offers financial support in the areas of small and medium-sized enterprise, entrepreneurship, environmental protection, housing, infrastructure, education, finance and development cooperation. As of 2011, KfW reported total assets EUR 495 billion (USD 642 billion) and a commitment to developing and transition countries totaling EUR 70.4 billion (USD 91.5 billion).
Sources and Additional Resources
[1] The Economic Times: “SIDBI gets 100.50 million euros from Germany’s KfW,” http://articles.economictimes.indiatimes.com/2013-06-27/news/40233462_1_sidbi-small-industries-development-bank-segment
MicroCapital brief, December 22, 2012, “MICROCAPITAL BRIEF: Small Industries Development Bank of India (SIDBI) Among Banks Requiring Third-Party Assessment of Codes of Conduct from Microfinance Institutions (MFIs) Seeking Wholesale Loans,” https://www.microcapital.org/microcapital-brief-small-industries-development-bank-of-india-sidbi-among-banks-requiring-third-party-assessment-of-codes-of-conduct-from-microfinance-institutions-mfis-seeking-wholesale-loans/
MicroCapital brief, April 2, 2012, “MICROCAPITAL BRIEF: Small Industries Development Bank of India (SIDBI) to Commit $5.8m in Equity, Loans to Small Microfinance Institutions”, https://www.microcapital.org/microcapital-brief-small-industries-development-bank-of-india-sidbi-to-commit-5-8m-in-equity-loans-to-small-microfinance-institutions
MicroCapital brief, March 27, 2012, “MICROCAPITAL BRIEF: 9.2m Microfinance Borrowers in India Have Defaulted Since 2010”, https://www.microcapital.org/microcapital-brief-9-2m-microfinance-borrowers-in-india-have-defaulted-since-2010
MicroCapital Universe Profile: Small Industries Development Bank of India (SIDBI) https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Small+Industries+Development+Bank+of+India+%28SIDBI%29
MicroCapital Universe Profile: KfWBankengruppe (KfW Bank Group)
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