Stressing that innovations in the country are "languishing" for want of financial support, President Pranab Mukherjee on Friday asked banks to open dedicated counters across India to meet the capital requirements of the segment.
Speaking at the Round-table on Financing of Innovations, he said that the high growth which India has envisaged is possible only with productivity improvements across all sectors of the economy.
"Innovations in different segments, at different levels and for different sections will aid this process in no small measure", he said, adding that the role of the banking system is paramount in the entire innovation value-chain since financing of innovation is a critical step.
"I would like to draw your attention to the financial needs of our ingenious youth, both in rural and urban areas that are yet to be adequately met by the banking sector. It would be appropriate if banks can open dedicated counters in towns and cities to meet the needs of innovators," he said.
The President noted that in India "unfortunately", there are many instances of innovations that are languishing for want of financial support.
As per a NSSO survey, there are about 5.7 crore small entrepreneurs employing about 12 crore people. The finance available to the segment is only about Rs 11 lakh crore and only about a small portion of it comes from institutional lenders.
Mukherjee said the banking system, in collaboration with the National Innovation Foundation, can help create a pool of mentors in every district to assess and meet the financial needs of innovators.
"Bankers have to take the initiative to reach out to innovators, mentor them, and wherever possible, connect them with their other clients who may help them in expanding their market. This role of creating linkages between creative people and successful clients could be a game-changing institutional innovation," he said.
The President said a bank manager "can open more doors for an innovator in an hour" than what an innovator could possibly be able to do in a year.
Financial Services Secretary Hasmukh Adhai said commercial banks have not been able to meet the requirement of innovators and entrepreneurs.
He stressed that the proposed MUDRA Bank will go a long way in addressing the capital requirements of small entrepreneurs.
Prime Minister Narendra Modi will soon launch the bank, he said. It will be initially set up as a subsidiary of SIDBI, but later a separate legislation would be enacted for it.
Photograph: Kanak Gogoi designs and builds futuristic vehicles