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BOB MSME SCALE 3 --- RELATIONSHIP MANAGER
Micro, Small and Medium Enterprises (MSMEs) have always played a vital role in the Indian economy. Not only do the 6.3 crore MSMEs in India contribute one-third to the GDP of the country but also provide employment to large sections of society.
Moreover, the sector is a critical source of livelihood and provides nearly 110 million jobs. Therefore, with the current emphasis on Atmanirbhar Bharat Abhiyan, these MSMEs have become even more significant to India’s economic and financial strategy.
Acknowledging the importance of the sector, the government of India (in 2019) envisioned that the sector would account for half of India’s GDP and add 50 million fresh jobs over the next five years.
However, there were significant signs of a slowdown due to Covid-19 (on the demand side) and structural reforms (on the supply side) like GST (goods and services tax) rollout and demonetisation also had adverse effects on the MSME sector.
Issues Faced by MSME
The fact that MSMEs contribute 55% and 60% to the GDP of Germany and China respectively is a clear indication that India still has a long way to go in its MSME journey. Following are the are that ails the MSME sector:
- The Credit Conundrum: A concerning gap in India’s MSME sector has been the credit supply shortage to MSMEs.
- The formal credit available to this sector is ₹16 trillion. The viable credit gap is ₹20 trillion against a total demand of ₹36 trillion.
- Further MSMEs in India typically rely on NBFCs and MFIs for their financing needs, given the lack of access to the banking sector.
- With the NBFC sector enduring a liquidity crunch since September 2018, MSMEs were hard-pressed for money.
- Lack of Formalisation Amongst MSMEs: The main reason for this credit gap is the lack of formalisation amongst MSMEs.
- Almost 86% of the manufacturing MSMEs operating in the country are unregistered.
- Even today, out of the 6.3 crore MSMEs only about 1.1 crores are registered with Goods and Services Tax regime.
- The number of income tax filers are even less. As a result, Indian MSMEs’ credit requirement has been largely unmet due to limited availability and access to data and legacy underwriting methods.
- Technological Disruption: India‘s MSME sector is based on obsolete technology, which hampers its production efficiency.
- With the emergence of new technologies like Artificial Intelligence, Data Analytics, Robotics and related technologies (collectively called as Industry Revolution 4.0) is a bigger challenge for MSMEs than for organized large-scale manufacturing.
- Regulatory Cholesterol: MSMEs require a lot of government services and approvals, for which the entrepreneur has to run around various government departments.
- Getting construction permits, enforcing contracts, paying taxes, starting a business and trading across borders continue to constrain doing business.
- Regulatory risks and policy uncertainty in the past have dented investor confidence.
- Problem of Scale: Majority of the firms in MSMEs are micro-enterprises.
- The MSME space is virtually a micro space formed by a plethora of small and local shops and hence, scaling them up is a problem, especially when fund access is challenging.
Due to these issues, the productivity of small firms in Indian manufacturing is abysmally low relative to larger firms. This has created a conspicuous ‘missing middle’ in the size structure of firms, which deters employment generation and dynamism in Indian manufacturing.
Way Forward
- Developing Bond Market: With India’s bond markets starting to take shape, promotion of SME bond issuances can provide a fillip to debt capital markets participation of MSMEs.
- While such issuances will provide lower interest rates for MSMEs than other financial intermediaries charge, they will also be a viable high-yield instrument for informed and educated investors operating in the bond market.
- Creation of Independent Regulator: Given the growing importance of the data economy, it is paramount that the government creates an independent body which can advise and provide consultancy to MSMEs and enable them to win in this new, digital world.
- Reforming Labour Laws: Labour laws are not very conducive to MSME growth. They must strike the right balance between providing a growth-oriented framework for MSMEs to run in and providing sufficient protection for the rights of workers.
- Improving Regulation: While Ease of Doing Business has been a focus area, the reporting, approval and compliance requirements for small businesses continue to border on the higher side.
- If we truly want to create a country where MSMEs can influence our economic destiny, it is imperative that they are provided with a hassle-free regulatory framework which works for them rather than against them.
Conclusion
MSMEs are the backbone of a resilient national economy. Prioritising their development is critical to the future of the country. The government has come out with a variety of enabling mechanisms over the last few years.
India needs more such measures, especially in the current environment. The next decade will be the metamorphosis of India from an emerging power to an established economic powerhouse and MSMEs will be an important cog in the wheel on this journey.
thanks dristi ias
Drishti Mains Question Prioritising the development of the Micro, Small and Medium Enterprises (MSMEs) sector is critical to the future of the country. Critically analyse. |
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BOB MSME RELATIONSHIP MANAGER-MMG SC.3 - PL GPAY RS. 610 9003037557 WAPP...
1) How many MSME Proposals you have
Processed ?
I have processed more than 30 MSME Renewal
Proposals during the FY 2023-24.
2) In your branch how many MSME
accounts are there ?
In
my branch, there are 52 MSME advances to the tune of RS.13.79 Lakhs
3) What you know about SIDBI and Role
Played by them for development of MSME Sectors?
SIDBI (Small Industries Development Bank of
India) set up
on 2nd April 1990 under an Act of Indian Parliament, acts as the Principal
Financial Institution for Promotion,Financing and Development of the Micro,
Small and Medium Enterprise (MSME) sector as well as for co-ordination of
functions of institutions engaged in similar activities.
To facilitate and strengthen credit flow to MSMEs and address both
financial and developmental gaps in the MSME eco-system
4) What is the contributions’ of MSME
sector to our Economy?
MSMEs make a crucial
contribution to India's GDP. MSMEs
contribute more than 29% to the GDP and are responsible for
50% of the country's total exports. They are also
accountable
one-third of India's
manufacturing output.
5) What are the commodities exported by
MSME to abroad?
Handicrafts,
handloom textiles, Ayurveda and herbal supplements, leather goods,
imitation jewellery and wooden products.
Or
Hosiery
and Garments (29%), Food Products (21.4) and Leather Products (15%).
6) MSME Commodities imported from
abroad?
Textile
machinery to handicrafts, diesel engine pumps to electronic components, bicycle
parts to sports goods all are being
imported in India hitting our MSME industry largely.
7) What you know about Bank of Baroda?
Bank of Baroda is an Indian government
Public sector bank headquartered in Vadodara, Gujarat. It is the second largest
public sector bank in India after State Bank of India. Based on 2023 data, it
is ranked 586 on the Forbes Global 2000 list.
Number of employees: 79,806 (2022)
8) How many branches have Bank of
Baroda?
9,693 Branches; 10,033+ ATMs (March 2023)
9) What are the Roles and
Responsibilities of Relationship Officer?
Relationship managers are an important
link between clients, partners, and customers, ensuring their needs are met. To
help drive sales and attract new clients, they work closely with various
departments, including marketing, customer service, and sales.
A relationship manager’s primary
roles and responsibilities, both on the client and business sides, include the
following.
●
Maintain
long-term relationships with clients through regular communication and
personalised support.
●
Handle
the onboarding process for new clients to ensure a smooth transition and
introduction to the brand’s products or services.
●
Identify
opportunities to enhance the client’s experience.
●
Generate
additional business through cross-selling or upselling.
●
Promptly
and effectively address client issues by coordinating with internal teams,
especially with key account managers.
●
Continuously
monitor client satisfaction levels by gathering feedback and conducting surveys
or assessments.
●
Know
the competition and market trends, and develop strategies to stay ahead.
●
Improve
and meet sales targets through long-term customer retention.
These are all the expectations
from a relationship manager with good experience.
10) What are the qualities required for
succeeding a Relationship Officer?
Communication :
Excellent communication is at the heart of a relationship manager's
role.
Analysis:
The skill to analyse allows client
relationship managers to study customer behaviour to ensure customer
satisfaction and improve the business
Leadership:
A RM needs to have solid leadership skills, as they are
expected to lead and inspire others to achieve shared goals
Negotiation:
A relationship manager often acts as a
mediator between the client and the organisation, requiring strong negotiation skills
Customer
Service :
Relationship managers need to have
excellent customer service skills
as it involves understanding and meeting the needs of client
Collaboration:
Collaboration between customers,
and organisational teams such as sales, marketing and even senior
organisational leaders are essential for the role of a RM.
Problem
Solving:
Problem solving is the process of
achieving a goal by overcoming obstacles, a frequent part of most activities.
Problems in need of solutions range from simple personal tasks to complex
issues in business and technical fields.
Interpersonal
Communication:
Interpersonal communication is an
exchange of information between two or more people. It is also an area of
research that seeks to understand how humans use verbal and nonverbal cues to
accomplish several personal and relational goals.
PQRST:
Study skills or study strategies are
approaches applied to learning. Study skills are an array of skills which
tackle the process of organizing and taking in new information, retaining
information, or dealing with assessments.
11) How you will bring 100 borrowers for
your bank/branch within 3 Months?
Usually we Doing:
We
will approach based on the reference of
our existing customer.
and
We
will search the customer loan details by using MCA Website, if the is a Limited
Company or LLP.
Based
on the existing customers Sundry Debtors/Creditors list mentioned in the ITR.
Based
on the existing customer RTGS / NEFT request, the receiver firm/company name
mentioned in the request.
Based
on the Inward Clearing and Outward clearing.
In
the Existing customer’s CIBIL report, if any business loans are available.
As per Data:
There are several ways that MSMEs
(Micro, Small, and Medium Enterprises) can find new customers using government initiatives. One of the
most effective ways is to use the Online National Database on MSMEs (ONDC) to identify potential customers and partners.
The ONDC is an online platform
managed by the Ministry of Micro, Small, and Medium Enterprises (MSME) that
provides information on MSMEs registered with the government. This information
can be used by MSMEs to find potential customers and partners, and to learn
about their products and services.
In addition to using the ONDC,
Indian B2B MSMEs can also take advantage of other government initiatives to
find new customers. For example, the government offers various schemes and
programs that provide financial support and assistance to MSMEs, such as the
Credit Linked Capital Subsidy Scheme (CLCSS) and the Prime Minister's
Employment Generation Programme (PMEGP). These programs can help MSMEs access
the capital they need to expand their businesses and reach new customers.
●
Joining
a local business association or chamber of commerce, which can provide
opportunities to network with other businesses and to learn about potential
collaboration opportunities.
●
Participating
in trade shows and other industry events, which can help to promote the
business and to connect with potential partners and customers.
●
Offering
joint promotions, such as bundling products or services, or offering discounts
to customers who purchase from both businesses.
●
Cross-promoting
each other's products or services, such as through social media or email
marketing.
●
Collaborating
on events or initiatives that are of interest to the businesses' target
customers, such as workshops, seminars, or community projects.
●
MSMEs
can also consider using digital marketing and B2B-centric e-commerce platforms
to reach new customers.
12) Have you Participated in Recovery of
NPA’s? give details
Yes,
I have Participated in Recovery.
13) What are the causes for MSME’s
becoming NPA?
Non-Performing Assets or NPAs have
become a major concern for banks and financial institutions in India. NPAs
arise due to various reasons, some of which are as follows:
1.
Economic
downturns
Economic slowdowns, recession, and slowdown in industrial
growth lead to a decrease in demand for goods and services. This, in turn,
affects the cash flows of companies, and they may default on their loans.
2.
Borrower
default
Borrowers may default on their loans due to various
reasons such as financial difficulties, fraud, or mismanagement. This leads to
NPAs.
3.
Inadequate
credit appraisal
Sometimes, banks and financial institutions do not carry
out proper credit appraisal while sanctioning loans. This may lead to the
borrower defaulting on the loan, and it becoming an NPA
14) What is SARFAESI Act 2002?
The SARFAESI Act full form is –
“Securitization and Reconstruction of Financial Assets and Enforcement of
Security Interest Act”. The SARFAESI Act allows banks and other financial
institutions for auctioning commercial or residential properties to recover a
loan when a borrower fails to repay the loan amount
15) What is IBC ?
The Insolvency and Bankruptcy Board of
India was established on 1st October, 2016 under the Insolvency and Bankruptcy
Code, 2016 (Code). It is a key pillar of the ecosystem responsible for
implementation of the Code that consolidates and amends the laws relating to
reorganization and insolvency resolution of corporate persons, partnership
firms and individuals in a time bound manner for maximization of the value of
assets of such persons, to promote entrepreneurship, availability of credit and
balance the interests of all the stakeholders.
16) Under which ministry MSME come and
Present Minister for Nations and State?
The Ministry of Micro, Small and
Medium Enterprises is the ministry in the Government
of India.
Narayan
Rane.
Tamil Nadu's Micro, Small and Medium
Enterprises (MSME) Minister T.M. Anbarasan
17) What are your strengths?
Easily
understand the customer needs / Problems by using vast Experience in Banking
18) What are your achievements ?
During
the FY 2023-24, I Become a 4 star Performer in My Bank out of 5 Star.
By
Canvassing 52 CASA accounts to the tune of Rs.19,13,322/-
By
Canvassing 28 Term Deposits to tune of Rs.68,40,203/-
By
Canvassing 6 Insurance Policies (4Max Life Insurance and 2 Bajaj) to the Tune
of Rs.4,46,982/-
By
Canvassing 8 Loan accounts (4 MSME Advances to tune of 20.00 Lakhs and 28.00
Laks) and 4 Housing Loans to the tune of 52 Laks.
19) Are you willing to work in other
states?
Yes, I have also already Worked in Mumbai
20) After 5 years from now, where you
are?
Assistant
General Manager in BOB, MSME Ceel/Department.
21) MD& CEO of Bank of Baroda?
Shri Debadatta Chand - Managing Director & CEO
22) Tagline of TMB?
Be
a Step ahead in Life
23) Tagline of BOB?
India’s
International Bank.
24) How many seats won by NDA Parties
and INDIA Alliance?
543
Total
: 293 235
BJP : 240 99 CONGRESS
Other
(TDP,jd ) :53
25) Problems based by MSME’S:
A) Lack/Non availability of Finance
B) Lack of collateral
C) Inadequate supply of Raw Materials
D) Infrastructure
E) Inadequate Knowledge and Access to
markets
26) What are the Schemes Bank of Baroda
Especially for MSME Sector?
Fintech
Baroda Overdraft for
E-commerce Business
(Amazon/Flipkart)
JanSamarth Portal : Introduction
National Portal
Platform with a single window for all credit linked subsidy schemes
Government of
India has initiated ATMANIRBHAR BHARAT ABHIYAN, a slew of economic measures to
make the country self-reliant. Under this initiative, Government has introduced
National Portal for Credit Linked Government Schemes called “JanSamarth”.
National Portal is an online marketplace, which enables the loan aspirants to
make their loan application online. The Platform would also have entire digital
loan processing up to In-principle sanction stage integrated in the system.
JanSamarth Portal : Benefits
●
Availability
of information on all credit linked subsidy schemes at a single place:
●
Facility
to check eligibility and loan application process without any intermediaries.
●
Ease
of completion of loan application process with minimal manual data entry. This
will be possible through data pre-population from various sources like Aadhaar,
PAN, IT Return, Bank Statement, Credit Bureau (CIBIL), Udyam Certificate (in
case of business entity)
●
Real
time status tracking for loan application
●
Real
time status tracking for subsidy release
JanSamarth Portal : Process flow
Retail Loans:
●
Any
individual (Salaried/Self-employed/Student) can apply for the loan under the
above retail loan products;
●
At
the start of the application, beneficiary will be authenticated through OTP
based Aadhaar verification and on successful verification, personal details
will be pre-populated which will minimize the input by the borrower and also
ensure data consistency.
●
PAN
entered by the borrower will be authenticated through integration with NSDL.
●
National
Portal is also integrated with CBDT systems, this integration enable the portal
to fetch income details as per IT Return based on the entered PAN.
●
Applicant
needs to upload Bank statement as per the product guidelines. With an objective
to simplify the process portal also has functionality for auto fetching of Bank
statement based on the penny drop functionality for the convenience of
applicant.
●
Applicant’s
credit history and details of existing liabilities will be fetched through
integration with credit bureau and same will be digitally verified
●
Further,
applicant needs to provide additional data points like demographic details,
Income projections, project details, loan requirement, existing loan details
(if any).
●
Risk
based scoring is carried out by the platform based on the various parameters
such as demographic, CIBIL score, tenure of loan etc.
●
Portal
will run Business rule engine, assess the limit requirement and based on the
data points fetched for the applicant and product parameters set by the banks a
suitable product matching the requirements of the applicant is displayed.
●
The
applicant will have to select its preferred Bank and Branch of the preferred
bank for further processing of the application.
●
Finally,
‘Agreement in Principle’ will be provided for selected product to the
applicant.
MSME Loans:
●
Any
self-employed individual, Sole Proprietor, Partnership Firm, Private Limited,
LLP, SEP-G, SHG etc. can apply for the loan under this facility.
●
The
applicant needs to provide KYC details like PAN, Aadhar number, Voter ID number
issued by Election commission of India and Udyam Registration.
●
The
applicant also need to provide income related document i.e. ITR, Bank
Statement, and GST number.
●
Portal
has functionality to automatically fetch the income related information i.e.
ITR/GST data/ Bank Statements details from original source after obtaining due
consent from the applicant. Additionally, portal also has functionality to
upload the Bank statement and ITR.
●
Credit
information for the applicant will directly be fetched from the Credit
Information bureau.
●
Further,
applicant needs to provide additional data points like demographic details,
Income projections, project details, loan requirement, existing loan details
(if any).
●
Risk
based scoring is carried out by the platform based on the various parameters
such as demographic, CIBILscore, tenure of loan etc.
●
Portal
will run Business rule engine, assess the limit requirement and based on the
data points fetched for the applicant and product parameters set by the banks a
suitable product matching the requirements of the applicant is displayed.
●
The
applicant will have to select its preferred Bank and Branch of the preferred
bank for further processing of the application.
●
Finally,
‘Agreement in Principle’ will be provided for selected product to the
applicant.
Agri Loans:
●
Any
self-employed individual, Sole Proprietor, Partnership Firm, Companies,
Corporations, Co-operatives Marketing Federations, Autonomous Bodies of
Government, SHGs, NGOs etc. can apply for the loan under this facility.
●
The
applicant needs to provide KYC details like PAN, Aadhar details, Udyam
registration, ITR, Bank Statement, GST and other basic details.
●
The
ITR/GST data/ Bank Statements details uploaded by the applicant are analysed in
real time to simplify decision making process.
●
Finally,
‘Agreement in Principle’ will be provided for selected product to the
applicant.
JanSamarth Portal : Schemes
MSME
Loans:
|
Sr. No. |
Name of Product |
Coverage under
Subsidy scheme |
|
1 |
MSME Mudra Loan (both Cash Credit facility and Term Loan facility ) |
Not Applicable |
|
2 |
Stand - Up India Loans (Composite Loans) |
Not Applicable |
|
3 |
Weaver Mudra Loans (Demand Loan and Cash Credit facility) |
Applicable |
|
4 |
DAY- NULM (Cash Credit facility or Term Loan). |
Not Applicable |
The following -2- products are re direction to the
respective product specific portal.
|
Sr. No. |
Name of Product |
|
1 |
PM SVANidhi – PM Street Vendor’s Atma Nirbhar Nidhi |
|
2 |
PMEGP – Prime Minister’s Employment Generation Programme |