The government is considering the setting up of a mutual guarantee fund by the IT/software industry associations as part of efforts to ease availability of finance for small IT entrepreneurs, a top official said on Friday.
"We are considering the concept of a mutual credit guarantee scheme under which the industry associations would themselves support a guarantee for lending funds to a new entrepreneur," S K Tuteja, secretary, ministry of SSI, said.
Addressing a session on SMEs at the IndiaSoft 2003 organised by ESC, he said that a mutual guarantee fund could be set up by an association of industrial enterprises wherein the guarantee would be extended by the MGF to the 'dedicated bank' for the credit extended to its member industrial units.
Under the concept, which has been proposed by the Credit Guarantee Fund Trust for SSI, IT associations such as the Electronics and Computer Software Export Promotion Council or Nasscom could set up an expert group at the regional levels to evaluate proposals relating to software/IT related projects and give their opinion or recommendation.
Such opinion or recommendation would help to enhance the comfort level of the banks to finance such projects, he said.
Highlighting the fact that close to 60 per cent of India's software exports were from the small and medium enterprises, Tuteja said that the SSI ministry was funding a study of the successful SSI ventures in the IT sector being undertaken by the ESC.
© 2025