Chennai: In a move aimed at strengthening institutional understanding of micro, small, and medium enterprises (MSMEs), Indian Overseas Bank (IOB) signed a Memorandum of Understanding (MoU) with the Indian Institute of Banking & Finance (IIBF) on 17 May.
The partnership focuses on providing targeted training to bank employees to improve their knowledge and response to the credit requirements of MSMEs.
The MoU was signed in the presence of IOB Managing Director and CEO Ajay Kumar Srivastava at the bank’s central office in Chennai. It was formally executed by IOB’s General Manager (HR), Dillip Kumar Barik and IIBF’s Director (Academics), Dr K Gangadharan. Other key officials from both institutions also attended the signing ceremony.
MSMEs in Focus: Improving Credit Delivery
This collaboration comes at a time when MSMEs, considered a key segment in India’s industrial and employment landscape, are seeking improved access to formal credit. With challenges around timely financing and sector-specific understanding, banks are under pressure to enhance staff training to align with national economic goals.
The initiative by IOB and IIBF aims to address this by offering an online learning module and certification course specifically designed for IOB’s workforce. The course will be delivered in e-book format and culminate in a remotely proctored examination. Successful participants will receive a joint certification from IOB and IIBF.
Certification as a Step Toward Informed Lending
Unlike generic training, the programme is tailored to equip bank employees with practical insights into MSME operations, financial behaviour, and sector-specific lending risks. According to sources, the course material is structured to reflect the real-world challenges of MSME financing, enabling frontline staff to assess and respond to loan applications more effectively.
While this is not the first time a public sector bank has invested in internal training on MSMEs, the partnership reflects a broader trend within the BFSI sector, focusing on capacity building to meet policy objectives such as inclusive credit delivery and financial resilience.
The certification process is expected to be rolled out in phases, targeting specific employee groups across various branches.
Sector-Wide Implications
As policymakers and regulators push for greater formalisation and credit access for MSMEs, such institutional collaborations could serve as a reference point for other banks looking to implement similar programmes. With the Reserve Bank of India (RBI) regularly highlighting the importance of strengthening MSME credit pipelines, the initiative also aligns with ongoing efforts to professionalise public sector banking services.
