HDFC Bank, Mastercard, USAID commit $100-mn credit facility for small biz

The new credit facility aims to expand lending to small businesses in India that need financing to maintain and grow their operations, says HDFC Bank

The new credit facility aims to expand lending to small businesses that need financing to maintain and grow their operations, and enable recovery through digitisation, with an emphasis on supporting women-led businesses, said a statement from HDFC Bank.

The partnership is designed in such a way that HDFC Bank will look beyond its existing customer base and provide at least 50 per cent of the credit facility available to new small business borrowers. Also, the goal is that at least 50 per cent of the facility will be used to lend to women entrepreneurs. The bank is looking to achieve this through its extensive nationwide branch network.

On the other hand, Mastercard through its collaboration with the Confederation of Indian Industry (CII) and the Confederation of All Indian Traders (CAIT) will  provide skills training and education to small business owners on their digitisation options and help them grow their revenue through their “Mastercard Center for Inclusive Growth” for which it has committed Rs 250 crore. Further, DFC and USAID are facilitating the extension of the credit facility by de-risking HDFC Bank’s lending to small business owners.

“MSMEs are the backbone of the Indian economy and the ongoing pandemic has affected their lives and businesses. This partnership, we believe, will not only help extend credit, but also advise and assist them to modernise and digitise their businesses”, said Rahul Shukla, Group Head – Commercial and Rural banking, HDFC Bank.