MSMEs: Measures Govt Taken To Lift Them From Pandemic Effect; Know Details

Even as the coronavirus pandemic had hit the economy across sectors, MSMEs (micro, small and medium enterprises) were also got affected badly. Their financials were hit and their operations almost came to standstill having no activity, barring very few ones. The government has since then taken various steps to boost MSMEs.

As part of the Aatmanirbhar Bharat Package for MSMEs, the Centre had announced measures, including the Emergency Credit Line Guarantee Scheme (ECLGS), Self Reliant India (SRI) Fund and Credit Guarantee Scheme for Subordinate Debt (CGSSD).

ECLGS was announced as a part of the Aatmanirbhar Bharat package in May 2020 to provide collateral-free automatic loans for businesses, including MSMEs. Initially, the admissible limit of the guarantee was Rs 3 lakh crore, which was later enhanced to Rs 4.5 lakh crore. As per the Budget 2022-23 announcement, ECLGS is being extended up to March 2023 with an expanded guarantee cover of Rs 5 lakh crore. The additional guarantee cover of Rs 50,000 crore is earmarked exclusively for the hospitality and related enterprises.

In May 2022, the government also announced a Fund of Funds, SRI Fund, with the nomenclature SRI Fund to infuse as equity funding in MSMEs, which have the potential and viability to grow and become large units. This initiative is aimed at providing growth capital to the deserving and eligible units of the MSME sector.

The CGSSD scheme was also announced in May 2020 with a view to provide credit facility to the promoters of stressed MSMEs viz. SMA-2 and NPA accounts that are eligible for restructuring as per RBI guidelines on the books of the lending institutions. Under the scheme, the promoter would infuse the credit in the MSME as quasi-equity or sub-debt.

“In September 2022, the MSME ministry also assigned a study to the Small Industries Development Bank of India (SIDBI) to assess the impact of change in MSME classification on the sector. The terms of reference of the said study inter-alia also included an assessment of the impact of the COVID-19 pandemic on the MSME sector. The study reveals that around 65 percent of the MSMEs surveyed have availed the benefits of the Emergency Credit Line Guarantee Scheme,” the MSME ministry said in a statement on Monday.

State Bank of India (SBI) in its report in January 2022 said that almost 13.5 lakh MSME accounts were saved due to the ECLGS scheme (including restructured), of which about 93.7 per cent of the accounts were in the micro and small category.

Meanwhile, the central government’s ministries, departments and public sector enterprises made a total procurement worth Rs 9,665.35 crore from MSEs (micro and small enterprises) during the current financial year so far. In the last financial year 2021-22, Rs 52,374.22-crore procurement was made as against Rs 40,817.78 crore in 2020-21, according to the information available on the Sambandh Portal till July 28. In 2019-20, it stood at Rs 39,049.45 crore.

Read all the Latest News and Breaking News here

For all the latest business News Click Here 

Read original article here

Denial of responsibility! TechAI is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected]. The content will be deleted within 24 hours.