Introducing the world’s first SME focused rating agency, SMERA Gradings & Ratings Private Limited (SMERA), an Acuité Group company dedicated to providing ratings, due diligence and assessment services to MSMEs. SMERA was incorporated in 2005 as part of a plethora of measures taken by Ministry of Finance, Govt. of India and the Reserve Bank of India to help Indian MSMEs grow through better access to credit and sharper insights on their operations. Over the years it has rated over 50,000 MSMEs in over 300 clusters and 400+ districts across the country.
SMEs enjoy three primary benefits of SMERA ratings viz. access to finance, enhanced credibility amongst business partners and self-improvement tools that facilitates better business practices.
Any business needs finance to fuel growth and expansion. SMEs find it difficult to get loans and that too at competitive rates from banks and other financial institutions. This is largely because often they do not have a streamlined finance function, their documentation may not be in the desired shape, and the general perception that their practices are non-transparent doesn’t help their cause either. SME rating acts as a third-party opinion which, in turn, provides confidence to the banks. This concept since the initial days was backed by leading banks such as SIDBI, SBI, ICICI Bank, Bank of Baroda, Punjab National Bank, Standard Chartered Bank, Union Bank, Bank of India, and Indian bank. This adds another layer of comfort.
Secondly, SMEs partners with large corporates as well as companies outside India for businesses. However, many companies may not want to associate with these SMEs given the challenges of information asymmetry and perceived lack of transparency. In fact even finding good producers is difficult for large foreign buyers. SME rating acts as a reputation bridge in such cases.
Finally, while SMEs are key drivers of the Indian economy, many of these business entities are still evolving in order to become professional players with the best-in-class people. They want to have the right processes and be adopters of technology. With 50,000 SME ratings, SMERA has helped SMEs of varied scales to improve their systems and processes which, in turn, enables them to gain better acceptance amongst lenders, buyers and other business partners.
Keeping up with the sector’s adoption of digital applications, a fintech platform, SMERA Terminal, was created which interlinks bankers with potential SME borrowers. It helps bankers expand their credit portfolio profitably with the help of knowledge from SMERA and facilitate easy and cheaper credit to MSMEs. Over 2,500 MSME units have already been listed on SMERA Terminal.
Over the years, SMERA has received wide recognition and acceptance for its path-breaking work in India’s SME sector. The Department for International Development (DFID), UK extended Technical Assistance grant to SMERA under a World Bank Project in the year 2006. In the following year, the Association of Development Financing Institutions in Asia and the Pacific (ADFIAP) awarded SIDBI with “Outstanding Development Project Award” for setting up SMERA in an effort to eliminate information asymmetry and facilitate funding for MSMEs. IFC’s report in 2010 mentioned SMERA as ‘a novel and sustainable initiative of the Govt. of India to increase credit flow to the MSME sector in India’. In 2014, SMERA set up Credit Due Diligence offering- a thorough fact check to validate an entity’s claims. Three years later, it launched integrated tamper proof QR code in SME rating reports to facilitate easy access to crucial information.
SMERA not only assists MSMEs to get lower cost finance, but also to build credibility and confidence among their business partners, build reliability in international markets and also in self-improvement to be future-ready. And this is the greatest success of SMERA as an organisation and an industry leader.
Introducing the leader
SMERA is led by Mr. Sankar Chakraborti who is the CEO of Acuité Group. He has more than 25 years of expertise in developing and selling credit ratings, data, analytics, risk management, and financial research solutions. He has been witnessing the evolution of the Indian financial and capital markets over the years and is passionate about building robust solutions to assist decision-makers in making more informed decisions. Mr. Chakraborti is a member of FICCI’s Capital Markets Committee and Executive Committee of Maharashtra State Council. He is also a member of IBA’s Standing Committee on MSMEs and National MSME Council of CII.
IFSC CODE : KKBK0000203
MICR No.: 110485046
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