The NGAP aimed to increase Access to Finance for micro enterprises
Mumbai,17th October, 2023:- SIDBI & Global Alliance for Mass Entrepreneurship (GAME) have onboarded the first cohort for the NBFC Growth Accelerator Program (NGAP). This program is designed to aid capacity building of small NBFCs through curated interventions, enabling them to apply for institutional funding based on holistic evaluation parameters.
The five-month intense program includes handholding and mentorship from domain experts on Risk, Operations, Governance, and Technology aspects of the smaller / lower rated NBFCs. It is structured to encourage and facilitate peer learning, reviews, and networking through a blend of in-person, virtual and individualized sessions.
NGAP (www.ngapindia.com) is an initiative by SIDBI and GAME to address the capacity building of smaller/ lower rated NBFCs which would enable them to access institutional credit at competitive interest rates. While such NBFCs are best suited to fund new to credit and micro enterprises in remote geographies, they need adequate funds at a reasonable cost for sustainable development of MSME sector.
Speaking about the initiative, Mr. Sivasubramanian Ramann, Chairman & Managing Director, SIDBI, said “NBFCs are an important vehicle in supporting the economic growth of the country due to their willingness and ability to reach bottom of the pyramid businesses, especially in credit deficient geographies, adoption of innovative and nimble credit delivery models and understanding of the local ecosystem. SIDBI has, over the years, augmented its engagement with NBFC sector by reaching out to a more diversified category of NBFCs through its multiple innovative schemes. The Bank has, in the past, played a salient role in Institutional building for the MFI sector and is now actively looking to engage in the capacity building of smaller/ lower rated NBFC players to transform them into strong entities for taking up larger role. The NGAP is one of the initiatives in this direction. He was confident that a significant number of participants would be able to benefit from the programme and improve their operating parameters and access to institutional funding, which in turn will lead to increased flow of credit to MSME sector.”
Explaining the design of NGAP, Mr Ravi Venkatesan, Founder, Global Alliance for Mass Entrepreneurship, said, “Our objective was to design a replicable model to enable MSME-focused NBFCs to become eligible for formal funding and future-ready. NGAP helps participating NBFCs to improve their parameters post the program and be in a better position to apply for funding. We are hopeful that at least 80% of the cohort will receive funding post the program. Over the next year, we will have a larger pool of lendable NBFCs who can service a large number of MSMEs. The aim is to build capacities of 100+ NBFCs in 3 years thereby enhancing the flow of credit to MSMEs.”
Shri Umesh Revankar, Chairman, FIDC and Executive Vice Chairman – Shriram Finance Ltd lauded the initiative of SIDBI and GAME in conceptualising this unique program which could help a large number of MSME focused NBFCs enhance their internal risk management systems, improve corporate governance, and adopt appropriate technology for business. This, he felt, could make them more bankable to enhance the flow of credit to micro enterprises.
