Guwahati: Union Bank of India and Small Industries Development Bank of India (SIDBI) have signed a Memorandum of Understanding (MoU) for a Co-Financing arrangement for MSMEs. Lal Singh, Chief General Manager of Union Bank of India, and Vivek Kumar Malhotra, Chief General Manager of SIDBI, signed the MoU.

Under the terms of the MoU, Union Bank of India would explore joint financing/co-financing with SIDBI for MSME projects/units.

According to the press release, this MoU will help banks boost their client base while also assisting MSMEs in meeting their financial needs.

The arrangement's main elements include cooperative project identification and term loan and working capital funding for MSMEs. Initially, the arrangement would be at specified centres, and after these centres stabilised, other sites would be covered.

Lal Singh, CGM (MSME), Union Bank of India, remarked on the occasion, "MSME is one of the main sectors of our Indian economy, contributing to GDP, exports, manufacturing output, employment, women empowerment, and so on." MSME is one of the bank's priority areas, and Union Bank of India aspires to be the bank of choice for MSMEs.

This collaboration with SIDBI contributes to the Bank's aim of increasing loan flow to the MSME sector and providing operational comfort to MSME clients. Union Bank of India, through its Pan-India branch network, would be able to provide general banking products such as current accounts, savings accounts, working capital facilities, and other associated services to SIDBI's MSME customers."

SIDBI CGM Vivek Kumar Malhotra emphasised SIDBI's commitment to prompt finance for MSMEs across all sectors.