Development of secondary market for securitised SME bebt in India

Abstract

We have analysed the role that securitisation can play in enhancing the credit off take to the SME sector. The reason why securitisation has not become an important instrument in Indian capital markets is due to the restrictions imposed by the regulators which limited the liquidity of the securitised instruments. Now the regulators are moving in the direction of promoting liquidity albeit at a slower pace. SEBI has come out with listing guidelines for securitised debt where even retail investors will be able to invest in these securities. The securities will be issued in dematerialised form and any cash flows to investors will also be settled electronically.