HDFC Bank, Mastercard, USAID and DFC launch $100 mn credit facility for MSMEs in India

HDFC Bank, Mastercard, USAID and DFC launch $100 mn credit facility for MSMEs in India

FPJ Web DeskUpdated: Thursday, October 21, 2021, 03:04 PM IST
article-image
The new credit facility aims to expand lending to small businesses that need financing to maintain and grow their operations, and enable recovery through digitization, with an emphasis on supporting women-led businesses, it said in a press release/.Representative image |

HDFC Bank, Mastercard, US International Development Finance Corporation (DFC), and US Agency for International Development (USAID) today launched a $100 million credit facility to promote and encourage small businesses in India to digitize, while also helping Indian businesses, particularly those that are women-owned, to recover from the economic impacts of the pandemic.

The new credit facility aims to expand lending to small businesses that need financing to maintain and grow their operations, and enable recovery through digitization, with an emphasis on supporting women-led businesses, it said in a press release.

“This partnership, we believe, will not only help extend credit, but also advise and assist them to modernize and digitize their businesses. The highlight of this initiative is our commitment to encourage women entrepreneurs in India and be a meaningful partner in their entrepreneurial journey,” said Rahul Shukla, Group Head – Commercial and Rural banking, HDFC Bank.

“Through this partnership, USAID will help facilitate access to finance and support the digitization journey for women-owned small businesses and entrepreneurs to help them recover from the pandemic and reach their full potential,” said Veena Reddy, Mission Director, USAID India.

“This financing will enable women in India to remain in the workforce, succeed as entrepreneurs, and become more economically empowered, leading to post-COVID-19 economic stabilization, GDP growth, and increased employment regardless of gender,” said Algene Sajery, Vice President of DFC’s Office of External Affairs and Head of Global Gender Equity Initiatives.

“Partnerships that align the strengths of the private sector, government, and philanthropy are critical to building back stronger from the pandemic,” said Nikhil Sahni, Division President, South Asia, Mastercard.

How will the partnership work?

To enable small businesses and women entrepreneurs to connect to the networks that power the digital economy, HDFC Bank will reach beyond its current customer base to make at least 50 percent of this credit facility available to new small business borrowers, with a goal of at least 50 percent of the facility being used for lending to women entrepreneurs. HDFC Bank will channel the credit via their extensive nationwide branch network.

Through existing collaborations with the Confederation of Indian Industry (CII) and the Confederation of All Indian Traders (CAIT), Mastercard will provide skills training and education to small business owners on their digitization options. The Mastercard Center for Inclusive Growth will also help them to grow their revenue through a range of nationwide philanthropic training programs. This initiative is part of Mastercard’s INR $33 million (250 crores) commitment to enable small businesses in India to recover from the impact of COVID-19.

DFC and USAID are facilitating the extension of the credit facility by de-risking HDFC Bank’s lending to small business owners. DFC’s investment supports its 2X Women’s Initiative, through which the agency invests in projects that are owned by women, led by women, or provide a product or service that empowers women. This program is part of USAID’s COVID-19 response in India as well as its global Women Economic Empowerment Fund initiative.

RECENT STORIES

Analysis: Anonymous Electoral Bonds Reined In — But What About Anonymous Cash Donations?

Analysis: Anonymous Electoral Bonds Reined In — But What About Anonymous Cash Donations?

Game-Changing Alliance: Ambani's Reliance Ventures Into Adani's Power For The First Time; Acquires...

Game-Changing Alliance: Ambani's Reliance Ventures Into Adani's Power For The First Time; Acquires...

SRM Contractors IPO Subscribed 86.57 Times On Last Day Of Bidding

SRM Contractors IPO Subscribed 86.57 Times On Last Day Of Bidding

Tax-Saving Tip From Zerodha CEO Nithin Kamath: 'If You're Married And Hindu..."; Here's How To Save...

Tax-Saving Tip From Zerodha CEO Nithin Kamath: 'If You're Married And Hindu...

Holy Cities Like Ayodhya, Varanasi Attracting Big Retail Brands: Report

Holy Cities Like Ayodhya, Varanasi Attracting Big Retail Brands: Report