Chennai/ IBNS: Indian Bank on Tuesday launched “IND Spring Board”, an initiative for funding Start-ups.
This is in collaboration with the IIT, Madras Incubation Cell (IITMIC) K Ananth Krishnan, EVP & CTO, Tata Consultancy Services launched the product in the presence of Debasish Panda, Secretary, Financial Services Department of the Ministry of Finance.
Speaking on the occasion, Padmaja Chunduru, MD & CEO said: “It is a known fact that Banks find it difficult to fund start-ups , as they do not meet the requirements under traditional models of financing. The business models involving high technology, the lack of visibility of cash flows, credit history, the high burn rate, the high failure rate among start-ups make the process of due diligence for assessing viability by banks difficult. Resultantly, this segment has been almost completely funded by Seed Capital, or Private Equity from India / abroad. Both the GOI and RBI have been constantly bringing in enablers to help this ecosystem.
Indian Bank stepped in to bridge this gap in funding for start-ups through this collaboration with IITMIC. Under the MOU, IITMIC will refer start-ups with proven technology and established cash flows to the bank and also extend advisory to bank on the business model.
The Bank will extend loans of up to Rs. 50 crores to these start-ups for their working capital requirements or purchase of machinery, equipment etc.
"As the name goes, this initiative, we believe will be the spring board for start-ups to realise their ambitions. We see this collaboration as a perfect fit both for the Bank and IITMIC," she said.
Chundru also recalled that the bank has recently launched “MSME Prerana” programme to empower MSME entrepreneurs through skill development and capacity building workshops in local languages.
Debasish Panda (IAS), Secretary, Financial Services, MOF complimented MD & CEO and Indian Bank Team for effecting the seamless amalgamation of Allahabad Bank into Indian Bank.
He said that lot of initiatives have been taken by Indian Bank premerger and also post merger. He congratulated Indian Bank for launching IND Spring the new model for financing start-ups, which will be a game changer in Banking Industry.
In his address, Dr. Ashok Jhunjhunwala, Co- Chairman, IIT Madras-Incubation Cell praised the efforts taken by the Indian Bank Team in finalising the agreement/MOU very quickly. For start-ups working capital is a bottle neck, since they don’t have collateral and the entrepreneurs are also not in a position to provide personal guarantee. By launching “IND Spring Board” , Indian Bank has proved that it certainly cares for these entrepreneurs. This is a proud moment for the whole country.
While launching IND Spring Board, Shri K Ananth Krishnan, EVP and CTO, TCS lauded the initiative of Indian Bank and said that Start ups have the advantage of credit facility like Ind Spring Board now. At present, we are in 4th Industrial Revolution with various technologies emerging. Some of the most valued companies in the world are from the start up category. TCS also works through Co-Innovation (COIN) with start-ups across the globe.
The e- launch was attended by Board of Directors of Indian Bank, customers of the Bank and representatives from print & electronic media.
Executive Directors of the Bank M K Bhattacharya, V V Shenoy and K Ramachandran also participated along with FGMs, GMs and other Executives of the Bank. FGM Chennai, K Chandra Reddy distributed sanction tickets to two entrepreneurs on this occasion.
Padmaja Chunduru, MD & CEO, Indian Bank along with Executive Directors M K Bhattacharya, V. V. Shenoy and K Ramachandran at the launch of “Ind Spring Board”.