SME Business - Way Forward



SME Business makes substantial contribution to Indian economy through manufacturing output, Jobs and Exports. Commercial banks are in a position to leverage opportunity presented by this business segment, thanks to technology development and digitilisation of processes which have considerably reduced the cost of origination and monitoring this business. SME Business today is core strategy for ROE enhancement in any commercial bank. Due to COVID 19, this segment is in considerable stress and Government has announced series of measures to help this business survive and grow. The course will cover –

·       Overview of SME market and why it is attractive proposition for Commercial Banks.

·       Support Structure in India as compared to Global practices.

·       Impact of COVID 19 on this Business.

·       Assessment of Promoter Risks & Business Risks.

·       Assessment of Financial Risk & Sustainability Parameters.

·       Role of Collateral in SME Business.

·       Assessment of Fund Based & Non Fund Based Limits – Traditional/ Cash Flow Based.

·       Assessment of capital needs for growth of business

·       Decoding Recent Package announced for MSME Business.

Course Audience

Relationship Managers & Credit Officers in SME Business/ Processing Centres of the Banks/NBFCs.

SME Credit Controllers & SME policy makers in Administrative Offices of Banks/NBFCs

Course Content


Session 1                                                                                      

Duration – Total 3 hours with 10 minutes break in-between


·       Overview of SME Market & Impact of COVID 19 on this segment

·       Regulatory Support Infrastructure – PSL Classification, Subsidies, Price Preferences, Prompt Payment Code, TReDs, etc.

·       Portfolio Approach & Segmentation.

·       MSME Credit Rating of Rating Agencies & CIBIL SME Rating.

·       Scoring Model – Underlying Assumption/ Limitations.

·       Components of Due Diligence – Internal & External, Documents for Due Diligence.

·       Credit Risk Assessment – Promoter Risk & Business Risk

·       Credit Risk Assessment – Financial Risk & Cash Flow Assessment.

·       Evaluation of Sustainability of Business & Bench Marking.

Case Study on Promoter Risk & Business Risk


Session 2                                                                                      

Duration – Total 3 hours with 10 minutes break in-between

·       Assessment of Working Capital ( Traditional/ Cash Flow Based) – FB & NFB

·       Supply Chain Financing – Products & Assessment

·       Digital Lending, TReDs & Reverse Factoring

·       EWS Framework & Use of FinTech in continuous monitoring of end use, Diversion of Funds, Related Party Transactions

·       Ways to deal with Irregular Accounts with special reference to current environment.

·       Role of Collateral in SME Business

·       Security Assessment & Recovery Options

·       Decoding GoI MSME Package – Fine Prints, Efficacy and Implementation.


Case Study on Working Capital, Cash Flow Statement,

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