On: 10 AUG 2023 – The Government of India has taken many steps to provide hassle free loan to develop Micro, Small and Medium Enterprises (MSMEs) in the country. Some of them are given below:
i. Priority Sector Lending Guidelines: In terms of Master Direction on ‘Priority Sector Lending (PSL) – Targets and Classification’ dated September 4, 2020, all bank loans to MSMEs conforming to the conditions prescribed therein qualify for classification under Priority Sector Lending.
ii. Collateral requirements of MSME units: Scheduled Commercial Banks (SCBs) have been mandated not to accept collateral security in the case of loans up to ₹10 lakh extended to units in Micro & Small Enterprises category. RBI issued circular No. RPCD.SME & NFS. BC. No. 79/06.02.31/2009-10 dated May 6, 2010.
iii. CGTMSE provides credit guarantee to its Member Lending Institutions for loans extended by them to Micro and Small Enterprises without any collateral security and third party guarantee.
iv. With effect from 01.04.2023, the credit limit for Guarantee Coverage under Credit Guarantee Scheme for Micro & Small Enterprises has been enhanced from ₹ 2 crore to ₹ 5 crore and the annual guarantee fees have been reduced by 50%.
v. Under the revised guidelines of Prime Minister’s Employment Generation programme (PMEGP) issued on 13.05.2022, the project cost for Manufacturing and Services have been enhanced to Rs. 50.00 Lakh and Rs. 20.00 Lakh, respectively from Rs. 25.00 Lakh and Rs. 10.00 Lakh.
vi. Under Aatmanirbhar Bharat, the Government of India has announced Self Reliant India Fund to infuse equity in MSMEs which have the potential and viability to grow.
vii. New revised composite criteria of Investment & turnover for classification of MSMEs adopted on 26.06.2020.
viii. No global tenders for procurement up to Rs. 200 crore.
ix. “Udyam Registration” for MSMEs, for Ease of Doing Business w.e.f. 01.07.2020.
x. Launch of Udyam Assist Platform on 11.01.2023 to bring Informal Micro Enterprises under the formal ambit for availing the benefits under Priority Sector Lending.
As reported by Department of Financial Services (DFS), a total number of 2,11,501 loan applications have been received in which 1,90,897 loans have been sanctioned to women and SC/ST entrepreneurs in the country under Stand-Up India Scheme and an amount of Rs. 20,541 crore has been disbursed.
Schemes to Support MSMEs
The Micro, Small and Medium Enterprises (MSMEs) sector plays an important role in the growth of the Indian economy. As per the latest information received from Ministry of Statistics & Programme Implementation, the share of MSME Gross Value Added (GVA) in all India Gross Domestic Product (GDP) during the year 2021-22 was 29.2% and the share of MSME manufacturing output in all India Manufacturing output during the year 2021-22 was 36.2%.
As per the information received from Directorate General of Commercial Intelligence and Statistics (DGCIS), the share of export of MSME specified products in all India exports during the year 2022-23 was 43.6%.
The Udyam Registration Portal has 2,18,69,557 MSMEs registered since its inception (01.07.2020) to 08.08.2023 with an employment of 12,84,04,488 (as on 08.08.2023). This includes 30,96,140 informal micro enterprises on the Udyam Assist Platform with an employment of 38,57,385.
The Ministry of MSME is implementing MSME Champions Scheme, a Central Sector Scheme. MSME Champions Schemes comprising three components i.e., MSME-Sustainable (ZED), MSME-Competitive (Lean) & MSME-Innovative (for Incubation, IPR, Design and Digital MSME) for promoting competitiveness amongst Micro, Small and Medium Enterprises (MSMEs) by the way of wastage reduction through Lean Manufacturing, support for Design improvement, building awareness on Intellectual Property Rights, Zero Defect Zero Effect (ZED) Scheme to encourage and enable MSMEs for manufacturing of quality products, tools & to constantly upgrade their processes for achievement of high quality and high productivity with the least effect on the environment, and to promote & support ideas of MSMEs through Incubation across India.
The objective is to modernize MSMEs’ manufacturing processes, reduce wastages, encourage innovativeness, sharpen business competitiveness and facilitate their National and Global reach and excellence.
The Schemes are applicable for the benefit of registered manufacturing Micro, Small and Medium Enterprises (MSMEs) across India. The scheme assistance and subsidies are applicable as per the scheme guidelines. The guidelines and all other relevant information related to the scheme of MSME Innovative, MSME Sustainable (ZED) & MSME-Competitive (Lean) under MSME champions are available at http://www.innovative.msme.gov.in, http://www.zed.msme.gov.in & https://www.lean.msme.gov.in/ respectively and financial assistance provided all over the country are available at official website of DC (MSME).
This information was given by Minister of State for Micro, Small and Medium Enterprises, Shri Bhanu Pratap Singh Verma in a written reply to the Lok Sabha.
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