The credit ratings industry is expected to witness growth in their business in the coming few months with the continuous rise in the number of SMEs approaching them for credit ratings. This view is also shared by officials of the Credit Analysis & Research Ltd. (CARE Ratings), who believes that the agency will record brisk business in the fourth quarter of 2009-10. Speaking on the sidelines of an interactive session organised by CARE Ratings, Dr Dogra, managing director and CEO of the aforementioned rating agency, said, â€As interest rates will move upward, more SMEs will borrow in the current quarter. As more small businesses queue up for ratings, we expect about 30-35% rise in revenues this financial year.†Mr Dogra further revealed that CARE Ratings would rate about 1,000 firms, about 500 of them from the SME segment. So far, the agency has rated 769 companies, including 200 small firms in the current financial year. â€It is not only the big firms, but also small firms that are approaching the credit rating agencies for their ratings. Moreover, with the implementation of Basel II norms, it has become imperative for small firms to secure ratings from an independent agency. Therefore, there has been a healthy rise in the business volume of rating agencies,†said Radheyshyam Jajoo, director of Comprehensive Tax Services, a small-sized tax consultant in Kolkata. The credit rating industry, which according to Mr Dogra, has been clocking an average growth of 25-30% per annum,will have to maintain due diligence in rating SMEs than it does in rating big corporate houses.
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