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Volume : III, Issue : II, March - 2013 PROBLEMS AND PROSPECTS IN BANK SME FINANCING IN INDIA B. NAGARAJU AND KAVITHA VANI S.D Published By : Laxmi Book Publication Abstract : Financial services are vital in developing a vibrant SME sector. However
access to financial services to this sector remains severely constrained. Lack of access to
financing is consistently cited by SME's as one of the barrier to growth. Commercial
banks are the oldest institutions having a wide network of branches, commanding utmost
public confidence and having lion's share in the total banking operations. Often
commercial banks consider SME financing as risky and costly to serve because of
insufficient assets, low capitalization, vulnerability to market, and lack of accounting
records. The study attempts to understand the commercial banks lending to priority
sector and non priority sector lending and to identify problems and prospects of SME
lending. Overcoming the challenges can results in excellent opportunities to commercial
banks by proving a wide market to serve and make SME lending a profitable banking
operation. Moreover SME has multiple banking needs. This in turn can provide excellent
opportunities in the other banking operations. Commercial banks should be proud of
serving an important sector of the economy, which is the key engine growth of the Indian
economy. Keywords : Article : Cite This Article : B. NAGARAJU AND KAVITHA VANI S.D, (2013). PROBLEMS AND PROSPECTS IN BANK SME FINANCING IN INDIA. Indian Streams Research Journal, Vol. III, Issue. II, http://oldisrj.lbp.world/UploadedData/2122.pdf References : - Macmillan, Principles & Practice of Banking, 2009, Indian Institute of Banking & Finance
- Dr. Vasant Desai, Small-scale Industries and Entrepreneurship, 2008,Himalaya Publishing House.
- Dr. Vasant Desai, The Dynamics of Entrepreneurial Development And Management, 2010, Himalaya Publishing House
- Vijayaragavan Iyengar,2009, Introduction to Banking, Excel Books
- K.Venkataramana, Law & Practice of Banking, 2010, Sevenhill publication
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