SIDBI and IPPB enter into an MoU for the development of informal micro enterprises

India Post Payments Bank (IPPB) and the Small Industries Development Bank of India (SIDBI) entered into a strategic partnership to promote the extension of formal financial services and other support services to MSMEs, especially enterprises in rural and remote areas of the country. Shri Sivasubramanian Ramann, CMD SIDBI and Shri J. Venkatramu, MD & CEO, IPPB signed an MoU on October 11, 2023, in the August presence of Shri Vivek Joshi, Secretary, Department of Financial Services, GoI and Smt. Vandita Kaul, Member (Banking and DBT), Postal Services Board, Department of Posts, GoI.

The partnership aims to leverage IPPB’s rural reach and deep connect with village-level communities
and SIDBI’s lending and credit risk assessment models in reaching to informal and micro enterprises
in rural and remote areas as may be permitted under the extant regulations. IPPB shall also support
SIDBI’s customers digitising the payment mechanisms through its merchant onboarding system and
collection solutions like UPI, QR-based solutions, etc. The two Institutions will also undertake joint
programmes to upgrade the skills of Dak Sevaks in supporting credit and other services to micro-enterprises. They will jointly work together to identify other areas of mutual interest and undertake
various activities to support MSMEs and MSME ecosystems across the country with a special focus
on informal micro-enterprises.

Along with the signing of the MoU, announcements were also made for organising a hackathon involving
the Fintech community for innovation in financial services in rural areas as a Swavalamban
Challenge Fund to promote rural livelihood enterprises. Speaking on the occasion, Secretary, of DFS emphasised the potential that the proposed partnership between SIDBI and IPPB holds in furthering financial inclusion in the country, especially by targeting informal and micro enterprises in rural and remote areas.

Member (Banking & DBT), PSB highlighted the efforts made by IPPB within a short span of time since
its inception in promoting financial inclusion as well as digitising financial transactions to improve
affordability and ease of access to the very small enterprise. Mr Sivasubramanian Ramann, said, “We look forward to a fruitful and meaningful partnership with IPPB which can make a positive impact on millions of informal rural enterprises in the country by improving their access to financial services and financial literacy.”

Shri J. Venkatramu, MD & CEO, IPPB expressed the institutional desire to strengthen financial inclusion
initiatives and looked forward to the partnership with the principal Financial Institution for MSMEs in
the country.

About Small Industries Development Bank of India (SIDBI): SIDBI is India’s principal financial institution in India for the promotion, development and financing of Micro, Small, and Medium Enterprises (MSMEs). SIDBI plays a critical role in supporting entrepreneurship, economic growth, and financial inclusion across the nation through various programs like credit guarantees, direct credit, venture capital, digital platform, government program management, etc.

About India Post Payments Bank: IPPB, with 100% equity owned by the Government of India, was launched by the Hon’ble Prime Minister Shri Narendra Modi on September 1, 2018. The bank has been set up with the vision to build the most accessible, affordable and trusted bank for the common man in India. The fundamental mandate of India Post Payments Bank is to remove barriers for the unbanked & underbanked and reach the last mile leveraging the Postal network comprising 155,000 Post Offices (135,000 in rural areas) and 300,000 Postal employees.

IPPB’s reach and its operating model is built on the key pillars of India Stack – enabling Paperless, Cashless and Presence-less banking in a simple and secure manner at the customers’ doorstep, through a CBS-integrated smartphone and biometric device. Leveraging frugal innovation and with a high focus on ease of banking for the masses, IPPB delivers simple and affordable banking solutions through intuitive interfaces available in 13 languages. IPPB is committed to providing a fillip to a less cash economy and contributing to the vision of Digital India. India will prosper when every citizen has equal opportunity to become financially secure and empowered. Our motto stands true – Every customer is important, every transaction is significant and every deposit is valuable.
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Disclaimer: This is an official press release by SIDBI.

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