APSFC inks MoU with Bank of India

The Andhra Pradesh State Finance Corporation(APSFC) today signed an MoU with Bank of India(BoI) to ensure better credit flow to SME units in the state.

While APSFC can sanction a term loan of up to Rs 5 crore, the alliance with banks enables the corporation to participate in larger loan sanctions required by the projects in terms of working capital among other things.

The corporation had recently entered into a similar alliance with Andhra Bank and State Bank of Hyderabad (SBH).

Addressing mediapersons after signing the MoU, Ajeya Kallam, managing director of APSFC, said that the SME units have been facing problems due to the time gap between the sanctioning of term loans and sanctioning of working capital by the commercial banks.

The corporation's alliance with the banks will offer an integrated package of financial requirement under the one-stop-shop concept to the entrepreneurs, he said.

BoI general manager Nagesh Pydah said that the bank is already engaged in a major business process reengineering with SMEs.

The bank has created a strategic business unit (SBU) for stepping up credit flow to SMEs and the alliance with APSFC offers the bank an advantage in this endeavour, he said.

The APSFC's credit sanction has already crossed Rs 450 crore for the current financial year as compared to the target of Rs 500 crore.