MSMEs remain the bulwark of the economy: Need to build back better and bigger

Editors

Vishwanathan, N S

Description

The period under the pandemic has been stressfulnot only for individuals and informal and formalenterprises under the Micro, Small and MediumEnterprises (MSME). A study undertaken by KreaUniversity amongst women entrepreneurs foundthat a third of the businesses run by women wereshut either temporarily or permanently and theysuffered a revenue loss of more than 70%. The state has also responded with multipleinitiatives that are aimed at supporting andproviding succour to the sector. While the ReserveBank of India (RBI) had redefined the obligationsof the banking sector towards financing the microenterprises in particular, it was also working onthe basis of the recommendations of the Report ofM S Sriramthe Expert Committee on Micro, Small and MediumEnterprises. Of the recommendations made bythe expert committee, several were implementedand some were under consideration.3 Significantamong those implemented were the facilitationfor co-lending model for non-banking financecompanies (NBFC) and creation of a paymentinfrastructure development fund that helped increating a digital payments architecture for ruralMSMEs. There were some issues that emanated outof the changed classification of trade which wasmoved from the MSME ministry to the Ministryof Commerce and classified as trade making itineligible for registration as an MSME under theUdyog Aadhaar Memorandum (UAM), a step thatwas essential for banks to claim the achievementof targets under the priority sector lending (PSL)obligations.

Publication Date

1-4-2021

ISBN

978-8195524518

Publisher

ACCESS Development Services

Keywords

Micro, Small and MediumEnterprises, MSMEs, Indian Economy, Banking, Financial Inclusion

discipline

Business; Entrepreneurial and Small Business Operations; Social and Behavioral Sciences; Economics; Economic Development

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