The country's largest bank State Bank of India has entered into collaboration with a Japanese bank for the development of Japanese Small and Medium enterprises. SBI and Japan Bank for International Cooperation (JBIC) signed a Memorandum of Understanding (MoU) to this effect.
It is reported that both the banks have come together to develop and strengthen a structure for encouraging the Japanese Small and Medium Enterprises (JSMEs) and mid tier businesses who are customers of Japanese Regional Banks (JRBs). At present, Japanese Regional Banks (JRBs) do not have any branches in India.
JBIC is a financial organization, wholly owned by the government of Japan. It was directed by the Japanese government to look after the needs if JSMEs in respect of the financial services rendered by local banks in the Asian region.
SBI is reported to be benefitted by this tie up in two ways:
- It would mean increased business for SBI's domestic branches.
- It would mean increased funds to Tokyo and Osaka branches and result in stronger relations with JRBs, which are considered as banks having surplus liquidity.