The Small Industries Development Bank of India (SIDBI) and The Federal Bank Limited (FBL) have signed a Memorandum of Understanding (MoU) aimed at strengthening financing opportunities for Micro, Small, and Medium Enterprises (MSMEs). This partnership will provide financial assistance for project finance, machinery and equipment procurement, working capital requirements—including letters of credit and bank guarantees—as well as loans against property. Additionally, both institutions will explore joint financing options to enhance credit accessibility for MSMEs.

The MoU was signed by Shri Prakash Kumar, Deputy Managing Director of SIDBI, and Shri Harsh Dugar, Executive Director of Federal Bank, in the presence of senior officials from both organisations. This collaboration aligns with the shared vision of SIDBI and Federal Bank to drive the growth and development of India’s MSME ecosystem.

About SIDBI Established in 1990, SIDBI serves as the principal financial institution for the promotion, financing, and development of MSMEs in India. The bank executes its mandate through various initiatives, including:

Indirect Lending: Expanding credit reach through financial intermediaries. Direct Lending: Addressing credit gaps in the MSME sector. Fund of Funds: Supporting entrepreneurship and emerging startups. Promotion & Development: Handholding new entrepreneurs through credit-plus initiatives. Facilitator Role: Acting as a nodal agency for MSME-centric government schemes. About Federal Bank Federal Bank is a leading private sector bank in India known for its strong focus on SME and corporate banking. With this collaboration, Federal Bank aims to leverage its extensive financial expertise and digital banking solutions to provide seamless financing options for MSMEs.

This partnership is a significant step towards empowering MSMEs with accessible financial resources, thereby fostering economic growth, employment generation, and industrial expansion across India.