Ms Meghna Suryakumar, Founder and CEO, Crediwatch (A credit intelligence firm provides data insights to lenders and corporates for business entities)
In our view, some of the measures which should be welcomed by small businesses in India are - New definition for MSMEs - As per the new regulation, the new categorization of investment of Rs 1 cr and turnover of Rs 5 cr being classified as micro-units. Units with an investment of Rs 10 cr and turnover of Rs 50 cr will be classified as small units while those with an investment of Rs 50 cr and turnover of Rs 250 cr will be classified as medium units.the new definition will promote them into growing further in size and scale. The infusion of Rs 50,000 crore equity scheme for MSMEs with an excellent export track record will help them in getting listed, this move to further push – India’s step onto becoming self-reliant.
Collateral-free automatic loans - While this extends the previous loan moratorium benefits, the new terms should benefit as many as 45 lac businesses and help with working capital requirements in coming days. We believe, setting the threshold for eligibility (Rs 25 cr outstanding and Rs 100 cr turnover) is helpful. This would help the small businesses meet some immediate working capital needs like salaries, rents etc and would help kickstart the business after the lockdown. The distressed asset fund of Rs 4,000 crore, will aid 200,000 distressed MSMEs with loans of up to Rs 75 lakhs”.
Mr Sandip Chhettri, COO, TradeIndia.com (India’s largest online B2B marketplace)
"The Cabinet’s decision to further upward the investment and turnover limits for medium enterprises is a welcome one. After 14 long years since enactment of the MSME Development Act, a revision in MSME definition was announced last month, according to which limit of medium units was increased to Rs. 20 Crore of investment and Rs. 100 Crore of turnover. Now on June 1, it has been decided that for medium enterprises the limits will be Rs. 50 Crore of investment and Rs. 250 Crore of turnover.
After the May 13 decision, objections were raised that the Rs. 20 crore/100 crore limit was not enough considering market and price conditions, and it is great to see the Centre taking a positive step so promptly. Time has changed, and so is the market, and the latest move is a realistic and big step forward. We are also very positive about the new composite formula of classification for manufacturing and service units as now there will be no difference between the manufacturing and service sectors."
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