State Bank of India (SBI) and CRISIL yesterday signed a Memorandum of Understanding (MOU), under which CRISIL will assign ratings to small scale industries (SSIs) that are borrowers of SBI. These ratings will be carried out under the NSIC-CRISIL Performance and Credit Rating Scheme for SSIs. To assist potential and existing SSI customers of SBI in obtaining ratings, CRISIL is offering a special incentive by discounting its standard fee structure for the rating scheme.

The benefits of the MOU are numerous. The bank's SSI customers can get a CRISIL rating at a very low cost. They can use this rating to build credibility with SBI, and also with customers, suppliers and collaborators. Rated SSIs will find it easier to obtain funds from SBI at appropriate terms. Additionally, the rating report prepared by CRISIL can be used as a self-improvement tool.

For SBI, the rating will be an additional input to objectively and scientifically make lending decisions, and determine terms like interest rates, margins, and collateral requirements for SSI borrowers.

Said D. Thyagarajan, Director - SME Ratings, CRISIL, "CRISIL believes that the use of ratings in the SSI sector will benefit all stakeholders. The MOU with SBI, India's largest bank, marks a significant milestone in CRISIL's SME initiative".

About NSIC-CRISIL Ratings:
CRISIL has entered into an agreement with National Small Industries Corporation (NSIC) to assign ratings under 'NSIC-CRISIL Performance and Credit Rating scheme for SSIs'. This scheme helps SSIs by making rating services available to them at affordable fee levels. The Government of India, through NSIC, bears 75% of the rating fee for each SSI.