July 6

Analysis: SME-Focused Impact Investment is Being Sidetracked in India

By Shariq Khan

In the impact investing ecosystem, SME focused investing currently doesn’t look to be getting enough traction, according to experts.

“Despite the huge potential of impact investing in the MSME sector and its huge credit challenges, it seems that financing for SMEs has become predominantly the job of the Indian banking system. Somehow the capital is getting sidetracked and getting channelised to other avenues. Most multilateral development financial institutions and impact financiers have moved away from the broader categorisation of SME financing,” said Shachindra Nath, Vice-Chairman & MD of fintech platform UGRO.

He was speaking at a webinar titled ‘SME Lending & Social Impact in India’, organised by UGRO and SME Finance Forum, a global platform aimed at channelising access to finance for small and medium businesses.

Photo courtesy of nicolasdebraypointcom.

Source: The Economic Times (link opens in a new window)

impact investing, MSMEs