April 07, 2020

SIDBI Assistance to Facilitate Emergency response against coronavirus

By:

Invest India

SIDBI launches SAFE, SAFE-plus and SMILE Schemes to support MSMEs

Producing Goods and Services to protect India against Coronavirus

To help support the efforts to address the COVID-19 emergency, SIDBI is supporting MSMEs manufacturing products or providing services related to fighting the Coronavirus with the launch of two schemes- the SIDBI Assistance to Facilitate Emergency response against coronavirus (SAFE scheme) and SAFE Plus. Under the schemes, loans are being extended at a low rate of interest of 5% within 48 hours.

SAFE Plus has been especially introduced to provide emergency working capital against confirmed government orders, with the same rate of interest of 5%.

SIDBI has also opened an additional financial window for Healthcare Sector under its flagship scheme called SMILE. Medium and long dated loans under SMILE at attractive rates shall be provided for financing the healthcare sector including hospitals, nursing home, clinics, etc. for their requirements related to fighting Corona Virus.

Who is eligible?

SAFE Scheme: Both, existing SIDBI customers and new to SIDBI customers can avail of this loan up to INR 50 Lakh as either a term loan or a working capital term loan, with no collateral property required and quick release of funds with minimum formalities.
SAFE Plus Scheme: MSMEs executing government orders, which are eligible under the respective State Government’s special policy package for interest subsidy/subvention or capital subsidy can avail a loan up to INR 2 crore.
SMILE: SIDBI’s existing customers or new to SIDBI customers, both are covered, including greenfield

What is covered?

Production or service of all medical products being procured by the respective State Government under the fight against Covid-19.
The loans can be used to acquire equipment, plant and machinery, or other assets including the purchase of raw material required for production or service or to ramp up supplies of these products to meet additional emergencies.

What is not covered?

Greenfield projects, items not directly related to Covid19, Traders etc.

Key Features & Requisites:

	SAFE	SAFE Plus	SMILE
Objective	To finance MSMEs who are manufacturing any products or providing any services related to fighting coronavirus such as permitted drugs, sanitisers, masks, body suits, overalls, gloves, shoe covers, ventilators, testing labs, etc. The list is indicative.	To provide emergency working capital to MSMEs which are producing goods and services directly related to fighting corona virus, against specific orders form the government / government agencies.	A special window available for financing the healthcare sector including hospitals, nursing home, clinics, etc. for their requirements related to fighting Corona Virus.
Target Customers	All existing MSMEs – whether SIDBI’s existing customers or new to SIDBI customers		SIDBI’s existing customers or new to SIDBI customers, both are covered, including greenfield.
Purpose of loan	To purchase any equipment/assets for manufacturing/service To purchase raw material/consumables for production	To meet additional working capital requirement for production/service	To meet capital investment requirement only
Max Loan Amount and Loan Instrument	INR 200 Lakh (Upto 100% subject to asset coverage) The loan can be availed in any of the two forms Term Loan (for equipment machinery) Working Capital Term Loan (for material)	INR 100 Lakh (linked to turnover) The loan shall be given in the form of Revolving Working Capital Term Loan	Depends on project size. Up to 75% of the project cost. The loan shall be given in the form of Term Loan
Repayment	Term loan: Upto 5 years WCTL: Upto 18 months	4 months of each drawal Revolving facility	Option 1: Up to 30 months Option 2: More than 30 months
Interest Rate	5% p.a. on reducing balance basis		Up to 30 months: 6.02% p.a. More than 30 months: Normal rate as per rating and tenure.
Security	No collateral		As per loan policy
Turnaround Time	Within 48 hours		5 days
Validity	Drawals under the scheme shall be valid till 30 September 2020
Others (if any)	Other guidelines of respective schemes shall continue to be applicable. The amount of capital subsidy when received shall be utilized to reduce SIDBI loan and/or for clearance of SIDBI dues. Rate of interest on loan to be set appropriately considering the interest subvention available from State Government.
Items covered	Permitted rugs, Ventilators, N95 Masks, Eye protection (visor / goggles), Protective Gowns / Aprons, Medical masks (surgical / procedure), Shoe covers, IV Fluid – DNS, IV Fluid – Dextrose, IV Sets, IV Cannula, ICU Beds, Cardiac monitors, Syringe pumps, Portable x-ray machines, Endotracheal tube, Suction tube, Oxygen cylinders, Rubber Sheets, testing labs, etc. The list is indicative.		Any capex related to healthcare sector which helps in fight against covid-19