Small scale enterprises have been given an important place in the framework of the Indian economy since independence. The SSI sector units account for 95 per cent of the country''s total number of industrial units, 40 percent of the output of the whollmanufacturing sector, 35 per cent of the country''s total export and provide employment opportunities to around 17 million people.Nearly 8000 products are being manufactured by this sector.Finance is the important driving force and ingredient for the development of Small Scale Industries.Industrial development can be accelerated. The participation of new entrepreneurs in economic activities depends upon the sources of and access to the funds on reasonable terms and conditions. The financial sources for small scale industries may be broadly categorized into two types viz., fixed capital or long term capital and working capital or short term capital. One of the major problems of small scale industrial sector, is non-availability of adequate funds at reasonable rates and conditions. The credit institutions need to overhaul and strengthen the follow-up and supervisory machinery at the branch level.