Credit and Finance for MSMEs: Assocham has recommended the government multiple steps, in the light of Coronavirus impact on the trade and economy, to limit the disruption caused to micro, small, and medium enterprises.
Credit and Finance for MSMEs: Industry body Assocham has recommended the government multiple steps, in the light of Coronavirus impact on the trade and economy, to limit the disruption caused to micro, small, and medium enterprises (MSME). In a recommendation report for “National Response to Economic Impact” of the deadly virus, Assocham said concessional working capital loans should be given to MSMEs “ equivalent to one to three month’s (based upon the extent of disruption) average turnover of last year.” Apart from this, another concessional finance “at a rate of 5 per cent for three months through SIDBI,” should be provided to MSMEs.
You might also be interested to read: Coronavirus: Corporate Affairs Ministry Asks Businesses To Report Preparedness
Particularly MSMEs, which are exporting goods globally, are facing the heat as their buyers are likely to cancel orders eventually. “In a lot of emails, buyers are asking our members to hold back the consignments. Most of the request is emanating from Europe followed by the US and other regions. Since demand has taken a hit, we feel many of these orders may eventually be cancelled,” Ajay Sahai, CEO and DG, FIEO had recently told Financial Express Online. India’s MSME sector, as per the MSME Ministry FY19 annual report, has 6.33 crore MSMEs out of which 99 per cent are micro-enterprises while small and medium-size businesses account for 0.52 per cent and 0.01 per cent shares.
Source: Financial Express
