Download - MSME - Rating

8/3/2019 MSME - Rating

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MSME Rating

Performance and Credit Rating

Presentation by

Shailesh Waghmare

Head Marketing - SME


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About ONICRA

Independent corporate body incorporated in 1993, an established player in Performance

and Credit Rating in Indian market

The only organized platform in India for individual credit risk assessment / management

and Information exchange

Acknowledged as pioneers of Individual Credit Rating in the Economic Survey of

India 1993-94issued by Ministry of Finance, Government of India

A Government accredited Rating Agency for MSMEs, by Ministry of MSME through

National Small Industries Corporation (NSIC) and recognized by Indian Banks

Association (IBA), for Financial and Performance Rating

National Skills Registry (NSR) Certified Employment Background Screening agency


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Snapshot

Technology Services Network


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Business to Business Services

B2B

Delivering rating reports

of individuals to our

clients in Banking,

Insurance and Telecom

segments, helping them

in taking credit decisions

Comprehensive Credit &

Performance Rating Reportto MSME units have helped

them in increasing their

Acceptability & Credibility

with Vendors, Suppliers,

Banks & Financial

Institutions, etc.

Background Checks

(including Identity,

Professional,

Educational, Criminal,

Health or Reference

Checks) have helped our

clients to reduce the risk

of employee frauds

Financial & PerformanceRating reports help our

clients to Indentify the

right channel partners


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ONICRAs Experience

The following factors have differentiated Onicra from the rest in the Industry:

Coverage:

We have a nationwide network of 150 inter connected Offices, covering over 400

Locations.

Synergy:

Onicra officials across India have worked in close co-ordination with the Large

Corporates Zonal/Regional Offices and Branches to reach out to the Vendors.

Activity Level:

We have actively conducted Vendor Cluster Meetings, Seminars, Awareness

Programs, etc where existing and prospective Vendors have been educated on the

benefits and requirement of Rating.

Focus:

Our keen interest on Vendor Ratings as a Business Vertical within the Company has

brought in innovativeness of strategy and speed of action.


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ONICRA Advantages

Rated over 6000 Associates / Vendors / MSME Units

Rated among top 2 agencies for MSME Rating in India

One of the fastest growing Credit Rating agency with approx 100% growth YOY

MoU with 24 leading Banks and Financial Institutions including PSU Banks,

State Financial Corporations, Regional Banks, Rural / Gramin Banks, etc.

Empanelled with Navel Dock Yard, Mumbai

Lowest Turn Around Time (TAT) in the industry

Nationwide infrastructure to meet the ever-growing needs of our customers, covering

400 locations


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Working Relationship with Banks & FIs

1. Bank of Rajasthan

2. Bank of India

3. Punjab National Bank

4. Allahabad Bank

5. United Bank of India

6. Union Bank of India

7. Central Bank of India

8. State Bank of Mysore

9. State Bank of Hyderabad

10. State Bank of Travancore

11. Tamilnad Mercantile Bank

12. Punjab & Sindh Bank

13. Andhra Bank

14. Karur Vysya Bank

15. Oriental Bank of Commerce

16. UCO Bank

17. Andhra Pradesh State Financial Corporation

18. Karnataka State Finance Corporation

19. Jammu & Kashmir Bank

20. IDBI Bank

21. Citizen Cooperative Bank

22. Pachim Banga Gramin Bank

23. Orissa State Financial Corporation*

24. Assam Gramin Vikas Bank


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MSME

Rating

Services

NSICNSIC ONICRAONICRA

PERFORMANCE & CREDIT RATING FOR Micro &PERFORMANCE & CREDIT RATING FOR Micro &

Small EnterprisesSmall Enterprises


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Introduction

NSICNSIC ONICRAONICRA PerformancePerformance && CreditCredit RatingRating SchemeScheme:: Comprehensive Credit &Performance Rating Report to MSME units have helped them in increasing their Acceptability

& Credibility with Vendors, Suppliers, Banks & Financial Institutions, etc.

Understanding the urgency faced by the MSME units, Ministry of MSME, Government of India

through National Small Industries Corporation (NSIC) has signed a Memorandum of

Understanding with us to provide Performance and Credit Rating services. The scheme was

launched by the Honorable Finance Minister and is approved by Indian Banks Association(IBA). The Ministry of MSME is offering a subsidy of 75% on the ONICRA Rating Fee.

Scheme Features:Scheme Features:

Turnover based Fee Structure Turnover based Fee Structure

Rating Approved by

Indian Banks Association (IBA)Scheme implemented through

National Small Industries Corporation (NSIC)


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Benefits of ONICRA Rating to MSMEs

Adds credibility to the status of the MSME

Helps to deal with large companies

Motivation to adopt good governance practices

Help in Marketing and serve as first point to generate interest among

potential trading partners

Tool for self correction & self improvement

Increases credit acceptability with banks and financial institutions

Concession in interest rate on NSICs Raw Material Assistance / BG

Scheme

Creates confidence among buyers and suppliers by establishing credibility &

goodwill


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Value Proposition for MSMEs

Benefitsof NSIC

OnicraRating

CreatingAwarenes

s

Confidence

amongstBuyers &Suppliers

RiskManagement

IncreasedProductivit

y

Acceptabili

ty withBanks &Financial

Institutions

Enhancesacceptability withbanks, lenders

and financial

institutions. This

gives fast access

to credit at low

interest rates.

Highlights strengths

and weaknesses of the

existing operations

and recommends

corrective measures.

Awareness is created about the

strengths, weaknesses, opportunitiesand threats. This helps in identifying

areas where improvements are needed.

Credibility and

goodwill isestablished while

undertaking

business

transactions.

Highlights parameters

measuring operational,

financial, business and

management risks.


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Value Proposition Banks & FIs

Second Opinion - Third Party unbiased opinion

An additional input to make lending decisions

Comfort level for a prudent decision-making

Reduction in information asymmetry in the MSME sector

Warning signals through periodic rating review

Focus can be driven towards exposure on low risk accounts

Cost and time effective method of processing


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Rating Scale

Performance

Capability

Financial Strength

High Moderate Low

Highest SE 1A SE 1B SE 1C

High SE 2A SE 2B SE 2C

Moderate SE 3A SE 3B SE 3C

Weak SE 4A SE 4B SE 4C

Poor SE 5A SE 5B SE 5C


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Rating Process

Pre Site Visit

Submission of list of the required documents to the applicant for the rating process

Agreement for a suitable date for the site visit

Site Visit

Meeting with the applicant along with the structured questionnaire (this questionnaire includes thebasic details of the applicant along with their family background, existing business, risk takingcapacity, synergy in the business)

Feedback from existing Bankers through Bankers questionnaire

Factory inspection

Assessment of the assets employed, working conditions, process flows, etc.

Collection of documents, not yet collected

Post Site Visit Reference Check

Customer Satisfaction verification

Supplier Feedback

Financial Analysis

Submission of Analysis to Rating Committee

Approval of Analysis & Assignment of Rating

Generation of Final Report


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Detailed Process Flow

Request for

Rating

Financials +

Other info

Pre-Analysis Formalize

Assignment

Login with

NSIC

Rating Appealed Publish Rating Institution advised on

draft report

Draft Report & Rating

Proposal

Rating Committee

Industry Data

Additional

Information

In depth

Analysis

Meet

Institution &

Site Visit

Detail

Questionnaire


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Documents Required

SSI Registration Certificate

Partnership Deed or Memorandum & Articles of Association

List of all directors or partners with their age, address, net worth, income tax return, qualification and

experience

Copy of audited accounts for the last three years

Authority letter to sign the application

Nature of advance & security provided, in relation to the loan/credit facility availed from banks

In case of new project/expansion, Project Report containing a brief project profile, cost of project,

sources of finance

Brief about products manufactured, end users, marketing tie-up & orders in hand

Details of subsidies & tax concessions available

Quality certificates & export awards won

Membership of any associations

Details about factories and its ownership

Any other information that would enable us to understand your business better


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MSME Rating Report

Status of

the Unit

3600

Analysis


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Impact of Rating on MSME Units

In a survey done on impact of credit rating on companies, there was data available to showthat rated units had:

Percentage

67

45

60

24

10

23 2216

Survey Highlights Impact of Ratings on MSME Units

Higher Customer Recognition

Increased Customer Queries

Increase in Sales

Increased Exports

Better Interest Rates

Enhanced Credit Limits

Improvement in Quality

Increased Capacity Utilization


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Customers Feedback

The Credit Rating of our operational & financial performance by ONICRA was a

great learning experience. This process has been very methodical & systematically

approached rating system and has revealed certain hidden facts leading to our

knowledge enhancement. We are getting exciting response from our bankers

towards enhancing our credit limits on request.

Mr. Deepak Gupta

C D Engineering Company - Ghaziabad

The performance and Credit rating initiated by NSIC is of tremendous help to

Small Scale Units. The entire exercise conducted by ONICRA was very systematic

and disciplined and the report facilitated in strengthening relationships with our

bank. The rating helped us in availing an enhanced credit limit from our bank. We

would highly appreciate this gesture of your and seek to further strengthen this

relationship.

Ashok Arora

MD Arora Enterprises Pvt . Ltd. - Amritsar


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Thank You!

For Further Queries, Kindly Contact:

ONICRA Credit Rating Agency of India Ltd.

Corporate Office:

11th Floor, Vatika City Point, Gurgaon 122 002Fax: 0124 3076033

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