and caters interoperability as the core service to the community. the retail payments in the next 3 – 5 years are likely to be driven essentially through mobile payments. this is to ride on over 1 billion mobile connections in the country and the financial inclusion drive. 7. in order to participate in the ensuing payment revolution and to take advantage thereof, we need to be taking certain strategic actions. these are as follows : a ) expanding the acceptance ecosystem : the proliferation of digital channels is evident mostly in the tier i & tier ii centres of the country. in order to promote digital channels, it is incumbent on the ecosystem which includes the banks, network partners and others. to ensure that there is adequate availability of digital channels and enablers such as debit cards, internet banking registrations, etc. in tier iii to tier vi centres as well. it is of critical importance that the population in over 6 lakh villages in the country is exposed to the alternate delivery channels. some estimates indicate that to reach the average levels of bric countries, india will need 20 million pos terminals as against the current 1. 2 million. this is a tall order. b ) government initiatives : there have been attempts to move the government direct benefit transfers onto electronic channels. i believe that with over 946 million aadhaar numbers having been issued, electronic benefit transfer is a clear strategy to promote efficient payment systems. c ) interoperability : interoperability of the digital channels as i mentioned earlier is a key driver to promote digital channels. the digital channels by definition should be available anywhere & anytime. d ) simplicity and standardization : end customers need to have simple ways of accessing the digital channels. this can be brought about through seamless processes driven by the ecosystem partners. and for this, standardization of the processes, right from registration to delivery and post delivery services is an imperative. e ) security : no electronic payment mechanism can undermine the role of security and risk mitigation in promoting digital channels. there has to be continuous and concerted efforts to ensure that the digital channels are safe & secure. the confidence of customers shall be a key to deepening the usage of digital channels. 8. with these steps, and in association with the key stakeholders like the reserve bank, the government, the banks, the payment system participants and the catalysts like npci, the reserve bank is quite sanguine that india will reap the advantages of the payment revolution. 9. i wish npci and

k c chakrabarty : bank credit to micro, small and medium enterprises ( msmes ) – present status and way forward address by dr k c chakrabarty, deputy governor of the reserve bank of india, at the formal release of the india micro, small and medium enterprises report 2010 of the institute of small enterprises and development ( ised ), kochi, 21 may 2010. assistance provided by smt l vadera in preparation of this address is gratefully acknowledged. * * * 1. dr p m mathew, director, ised, dr k n kabra, chairman, ised, shri t o sooraj, director, industries and commerce, government of kerala, dr yerram raju, senior fellow, ised, senior bankers, msme entrepreneurs, other distinguished guests, ladies and gentlemen. i am indeed very happy to be in your midst today for the release of the 13th issue of the india, micro, small and medium enterprises report series of your institute. the msmes, given their limitations and constraints need professional support, to analyze their own environment, articulate their needs and understand the impact of policies that get shaped there from. i am glad that the institute is endeavouring to provide this support. 2. in a nation ’ s economy, it ’ s the small and micro enterprises which play a vital role. for, they not only give employment to a large number of unskilled and semi - skilled people but also support bigger industries by supplying raw material, basic goods, finished parts and components, etc. the critical role and place of the msme sector in the indian economy in employment generation, exports and economic empowerment of a vast section of the population is well known. there are about 2. 6 crore enterprises in this sector. the sector accounts for 45 per cent of the manufactured output and 8 per cent of the gross domestic product ( gdp ). msmes contributed close to 40 per cent of all exports from the country and employ nearly 6 crore people which is next only to the agricultural sector. msme is the best vehicle for inclusive growth, to create local demand and consumption. msmes cater to niche markets. the msmes of yesterday are the large corporates of today and could be mncs of tomorrow. thus the banks and other agencies should take pride while servicing the msmes as they are playing an instrumental role in the formation of mncs of tomorrow. 3. it was, therefore, only appropriate that the government of india enacted the