Private Capital
Cut risk weight to help smes, banks tell rbi
11 Dec 2023
1 min read
Even
though banks' dealing with SMEs have somewhat changed over the years, many
small entrepreneurs resort to private credit as most banks and large
non-banking finance companies have limited exposure to them. In the void
created over the past few years with NBFCs shrinking their books, alternative
investment funds (AIFs) are slowly emerging as providers of debt capital to
some of the smaller and unrated businesses.
According
to a recent report by Praxis Global Alliance and Indian Venture & Alternate
Capital Association, Indian private credit investments have grown rapidly -
deploying $5.1 billion in H12023 with average deal size of $80 million, up from
$2.4 billion in 2018 when the average deal size was $16 million.