Govt Credit Support Measures for MSMEs -During COVID Pandemic
No. PR- 067
June 22, 2021
Govt Credit Support Measures for MSMEs -During COVID Pandemic
MSME Committee of PHD Chamber of Commerce and Industry in association with Bawana Manufacturers Welfare Association (BMWA) organized a Webinar on Govt Credit Support Measures for MSMEs -During COVID Pandemic and SIDBIs New Schemes.
Mr. Sanjay Aggarwal, President, PHD Chamber in his welcome address highlighted the challenges faced by the MSMEs despite contributing significantly in the economy. The challenges like Physical infrastructure bottle necks, constraints in technology adoption, high logistic costs and lack of access to credit have been further compounded for the MSMEs due to the pandemic, said Mr Aggarwal. Loan availability of adequate and timely credit is a serious problem which the MSMEs are facing currently. To address these Liquidity problems credit support has been announced by the Government through the Atmanirbhar package. Lastly, he talked about the schemes launched by SIDBI devised under the guidance from the Union Government which facilitates funding for production and services related to supply of oxygen cylinders, oxygen concentrators, oximeters and essential drugs.
Mr. Anil Khaitan, Former President, PHD Chamber gave the Industry perspective. He shared his practical insights over the difficulties and challenges faced by the MSMEs. He also talked about the revolutionary FinTechs which streamline the process of credit availability for the MSMEs and are quick in processing the loan applications.
Mr. Mohit Jain, Chair, MSME Committee, PHD Chamber apprised all about PHD Chamber’s MSME Mentoring and Guidance Centre, which has been proactively, engaged in providing value added services with complete handholding and mentoring support to the needy MSMEs.
Mr. Rajeev Kumar Goel, President, Bawana Manufacturers Welfare Association (BMWA) in his address highlighted about how COVID Pandemic has severely impacted the MSME sector which has further created problems related to credit financing for them. He talked about the importance of a time frame in disbursement of loans for micro and small industries since problems are being faced by the industry regarding this. Lastly, he suggested that Professional help can be made available by Financial Institutions by means of visits to Industrial clusters and Associations for generating awareness of various schemes and providing assistance in documentation to MSMEs during these tough times.
Dr. S S Acharya, General Manager, Small Industries Development Bank of India (SIDBI) in his address mentioned that one has to keep in mind the long term future where the fundamental of India’s growth lies. He said that MSMEs need to continue planning and moving forward in the positive trajectory. He talked about the schemes by government and SIDBI for assisting MSMEs. He also mentioned about the cluster development fund set up in line with the recommendations by U K Sinha Committee and with assistance with Reserve bank of India for MSME development and promotions. The Objective of this scheme will be to support the State governments and State Government sponsored organizations MSMEs to create infrastructure towards development of MSME Clusters.
Dr. Acharya also gave a Presentation on various schemes offered by SIDBI namely SAFE (SIDBI Assistance to Facilitate Emergency response against Corona Virus), SHWAS (SIDBI assistance to Healthcare Sector in War Against Second wave of COVID-19) and AROG (SIDBI Assistance to MSMEs for Recovery & Organic Growth during COVID-19 pandemic) for quick credit delivery. The schemes SHWAS and AROG envisage 100 percent funding of upto an amount of Rs 2 crore to a MSME unit at attractive interest rate of 4.50 pc-6 pc p.a., within 48 hours after receipt of all the documents / information. SIDBI, considering the current distress caused by COVID-19 and being a national emergency, has devised these schemes to cater to help assist healthcare service providers’ fight against the pandemic.
Dr. R K Bharti, Joint Director, HOO, MSME-DI in his address assured the help required to the MSMEs during these tough times. He apprised the delegates and participants on the recent developments in front of the cluster development in Delhi. DSIDC has allotted land for cluster development in Bawana and Badli Area which will help in the overall development of industries during these times, said Dr. Bharti.
Dr. H P Kumar, Advisor, PHD Chamber and Former CMD, NSIC talked about the issues faced by the Sector during the pandemic due to increased liquidity constraints, payment of fixed expenses and decreased orders the payments were not realised creating further credit problems for them. He also talked about various schemes for aiding the MSMES like Schemes devised by SIDBI for quick Credit delivery, namely SHWAS and AROG, line of credit of Rs 50000 Cr by RBI to MSMEs to facilitate liquidity.
He also said that banks need to be proactive in terms of processing. There is a need for a centralised transparent portal for tracking and faster loan processing. He also suggested that MSMEs get themselves registered in GeM which enables them to become vendors for the government and also enable them to access government tenders. and also increase credibility. Lastly, he suggested that the time lag in delayed payment resolution and settlement can be reduced by a digital system mechanism which helps one in accessing proper evidence and documentation available on digilocker.
Mr. Ritesh Jain, Deputy Vice President, M1xchange gave an insightful presentation describing the process of transparent financing to MSMEs on M1Xchange. He talked about the struggle faced by the MSMEs to stay afloat due to paucity of working capital. The platform M1Xchange is a digital platform that deals in TReDS (Trade Receivables Discounting System) that is aimed at improving the flow of funds to the MSMEs by reducing the receivables realisation cycles. The Platform allows the SMEs to post their receivables on the system and get them financed, said Mr. Jain.
Mr. Karun Kumar, Assistant Director, MSME-GOI in his address talked about the CHAMPION portal launched by the Government for solving the grievances and encouraging, supporting, helping and hand holding the MSMEs. He also suggested MSMEs to take benefit from the Public Procurement Policy launched by the Government. He said that the 25% Criteria of Procurement of Goods and services under the policy includes 4% of total procurement of goods and services from MSEs owned by SC & ST entrepreneurs and 3% of total procurement of goods and services from MSEs owned by women entrepreneurs.
Mr. Dev Prakash Goel, Co-Chair, MSME Committee, PHD Chamber gave the Concluding remarks to all the esteemed panellists, participants and summarised the session.
The session had a question-answer round where the speakers answered all the questions. The session also witnessed the presence of senior members of PHD Chamber and other industry stalwarts’ pan-India.
PHD Chamber of Commerce and Industry