Mumbai:  NCDEX Spot Exchange today signed an agreement with State Bank of India, India’s largest public sector bank, to promote financial inclusion through an electronic pledge facility that will enable farmers and traders to use their goods stored in an approved warehouse as financial assets.

The NSPoT online trading platform has a unique accounting system – COMLIVE® – that can provide electronic warehouse receipts against commodities stored in approved warehouses. All farmers, processors and traders who hold goods in NSPoT-designated warehouses can avail of this facility.

Under the agreement between NSPoT and SBI, customers desirous of availing pledge finance have to deposit their goods in NSPoT-accredited warehouses. The banks issuing pledge finance will provide loans using the deposited goods as collateral. When the collateral is sold, banks will directly receive payment against the loan.

The facility will be launched initially in Maharashtra, Karnataka, Madhya Pradesh and Rajasthan.

Mr Samir Shah, MD and CEO of NCDEX said, “We are proud to take another step in our contribution towards liberalization of primary markets in the country. The collaboration will perform the important function of mobilizing credit for the agricultural sector by creating secured collateral for banks.”

MOU was signed by Dr. M. Geevarghese Vidyan, Chief General Manager, SBI, and Mr. Rajesh Sinha, Executive Vice President, NSPOT in presence of Dr. V Eswaran, General Manager, SBI and Mr. T.P. Ramchandani, Vice President, NSPOT.

Source: Lokesh Shastri