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SIDBI announces multiple MoUs to help MSMEs embrace energy efficiency


Sustainability for MSMEs: The first memorandum of understanding (MoU) was signed with the German development agency Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH for operating a Risk Sharing Facility (RSF) that provides credit guarantees to loans from commercial banks or non-banking financial companies (NBFCs).

Sustainability for MSMEs: SIDBI on Saturday announced partnerships with multiple stakeholders in the sustainable development ecosystem to help MSMEs embrace energy efficiency in their operations and also contribute to India’s Sustainable Development Goals (SDG) 2030 targets. The first memorandum of understanding (MoU) was signed with the German development agency Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH for operating a Risk Sharing Facility (RSF) that provides credit guarantees to loans from commercial banks or non-banking financial companies (NBFCs). The loan offering is towards enhancing activities of “waste management companies, low-carbon waste management solutions, biomethanation, recycling, composting, and refused derived fuel for use in cement kilns,” said SIDBI in a statement. 

The RSF’s initial budget would be EUR 4.2 million (around Rs 33.50 crore) which will be from the NAMA facility, said SIDBI. NAMA Facility is a multi-donor programme funded by the German Federal Ministry for the Environment, Nature Conservation, Nuclear Safety and Consumer Protection (BMUV), the UK Department for Business, Energy and Industrial Strategy (BEIS), the Danish Ministry of Climate, Energy and Utilities (KEFM) and Ministry of Foreign Affairs (MFA), the European Commission (EU), and the Children’s Investment Fund Foundation (CIFF). The facility supports the implementation of ‘NAMA Support Projects (NSPs)’ for sustainable, irreversible, and carbon-neutral activities. Around 15 waste management companies have already shown interest in accessing the debt guarantee facility from the RSF. 

The second MoU was signed with Technology Information, Forecasting and Assessment Council (TIFAC) to identify scalable green and clean technologies by MSMEs. TIFAC will assess technologies and projects while SIDBI will support MSMEs through financing under its various credit schemes to implement the identified technologies. TIFAC is a technology think tank under the Department of Science & Technology mandated to work towards future technological development in India in socio-economic sectors. 

The third MoU signed with the industry body Confederation of Indian Industry (CII) was also towards promoting clean and green initiatives among MSMEs and facilitating their implementation through SIDBI’s financing schemes. CII will organise webinars and workshops on different clean and green initiatives related to renewable energy (especially rooftop solar), energy efficiency/ management, net zero, green buildings, resource efficiency, circular economy, etc. 

SIDBI already runs initiatives such as the Srijan scheme to provide concessional loans up to Rs 2 crore per project for MSMEs at 3-5 per cent per annum interest rate for innovative technology projects that have either reached the pre-commercialization stage or have tested the market and are ready for scale-up.