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Objectives of SIDBI

1. To promote marketing of products of small scale sector.

2. To upgrade technology and also undertaking modernization of small scale units.

3. To provide more financial assistance to small scale ancillary and tiny sector.

4. To encourage employment oriented industries.

5. To coordinate all the other institutions involved in the promotion of small scale industries.

Functions of SIDBI

Coordinating and financing the various institutions involved in the development of small industries are
undertaken by SIDBI.

Functions:

Refinance to SSI:

Refinancing loans and advances provided by commercial banks to small scale industrial units. Different
types of loans are given to small scale industries, additional funds have been given to commercial banks
for promoting more borrowings of small scale industries. In fact, there are commercial banks with
separate branches meant exclusively for small scale industries.

Discounting the bills of SSIs:

Apart from discounting the bills of small scale industries, even hurdles arising out of financing small scale
industries are being discounted. The bank credit has gone up to Rs. 2,18,219 crores. The percentage of
bank credit to SSI has gone up to 17.5.

SIDBI offers assistance to exports:

Direct assistance to export oriented units and also to import substituting units in the small scale sector is
given the highest priority. There has been a simplified procedure for the exports of small scale
industries. Products of SSI exporters are displayed in international exhibitions with the help of SIDBI.
Other export related expenditures are borne by SIDBI. Latest packing standards and training
programmes on packing for exports are also financed by SIDBI. Trade delegations and sales and study
teams are sponsored for small scale sector under Marketing Development Assistance scheme.

Seed capital and also soft loan Assistance:

Seed capital is provided for starting of SSI units. Under this, the initial expenditure in starting the small
scale units are being met by SIDBI. In addition to that, SIDBI, under this scheme, undertakes the
following activities:

▪ Identification of potential entrepreneurs in the district.