Credit and Finance for MSMEs: SRI fund is a SEBI-registered category-II Alternative Investment Fund (AIF) that operates through the mother-fund and daughter-fund structure. It provides funding to daughter funds for onward provision as growth capital through equity, quasi-equity and debt.
Credit and Finance for MSMEs: The Self Reliant India (SRI) fund launched by the government to make equity investments in small businesses for their growth, listing on stock markets, and global expansion, has invested Rs 1,571.55 crore in MSMEs, according to the data shared by Minister of State (MoS) for MSMEs Bhanu Pratap Singh Verma recently. SRI fund is a SEBI-registered category-II Alternative Investment Fund (AIF) that operates through the mother-fund and daughter-fund structure. It provides funding to daughter funds for onward provision as growth capital through equity, quasi-equity and debt.
“Under SRI fund till 30th June, 2022, Rs 1,571.55 crore have been invested in MSMEs across the country,” Verma had informed Parliament earlier this month. In terms of the number of MSMEs supported, 75 enterprises were issued ‘digital equity certificates’ on June 30 by Prime Minister Narendra Modi at an event.
Announced by Finance Minister Nirmala Sitharaman in May 2020, around 5,000 MSMEs are expected to benefit from the government’s Rs 50,000-crore Self Reliant India (SRI) fund, MSME Minister Narayan Rane had said. “Assuming an average investment of Rs 10 crore per MSMEs, approximately 5000 MSME are likely to be benefited,” Rane had informed the Lok Sabha in February this year. SRI fund is implemented by a special purpose vehicle — NSIC Venture Capital Fund Limited (NVCFL).
MSME Secretary BB Swain at the MSME Business Conclave organised by FE Aspire in June this year had informed that 22 daughter funds have already been given funding. “What made me happier was that compared to what we (government) had planned that for every rupee that we put in, Rs 4 will be brought in by the daughter fund, while we had put in Rs 155 crore, what had actually gone in equity was Rs 1,540 crore,” said had Swain.
The government is the sole anchor investor in the SRI fund with the initial budgetary support of Rs 10,000 as the mother fund. The rest 80 per cent of the Rs 50,000 crore fund will come from daughter funds that will raise capital from outside sources such as banks, financial institutions, HNIs, venture capital and private equity investors, and others, as per the fund’s guidelines approved in September 2021.