Are alternative methods available in India for adequate SME financing?
Bigger and listed organizations have access to even international funds in the forms of equity, FCCBs, FII and FDI. SMEs have to mostly depend on bank lending and even the equity market is out of their reach. In the UK, the concept of Alternative Investment Market (AIM) under the LSE to access capital market by way of equity is available to the SME entrepreneurs. In India, however, the SMEs have to solely be dependent on bank lending and that too mainly on the Public Sector Banks. For sustainable double digit growth rate, innovative financing methods will have to create particularly for the SMEs. The SMEs may be allowed access to Capital Market by way of a concept similar to AIMs. If an SME company like Noida Toll Bridge can get access to equity funds at the AIMs market of LSE, why can’t the same be done within India itself? Though India experimentation has not been so successful with OTCEI, with the changing scenario and with much transparency and demutualization of equity, the proble
