Tag: Ministry of MSME

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MSME

MSMEs in Haryana Get Major Boost! Products Manufactured by MSMEs in the State To Get Global Market, Talented Artisans To Benefit

Clothing Business

Chandigarh, February 11: The products manufactured by the Haryana MSMEs will now get the global market as the Haryana government signed pacts with three companies on Thursday. The news was informed by Haryana Deputy Chief Minister Dushyant Chautala. The Minister, who also holds the industries department portfolio, said artisans producing traditional handloom products of the state will also get a reasonable price for their craft. The Deputy Chief Minister said the signing of MoUs with three companies of international and national level by the MSME department is a step towards ‘Atmanirbhar Bharat’. The pact will give a boost to the MSMEs of the state as well as to the talented artisans.

The pacts with ”eBay”, Power2SME”, India’s first ”buying club” for SMEs and TradeIndia.com, price and product discovery platform, was signed by Haryana MSME Department Director General Vikas Gupta and the representatives of the companies. The memoranda of understanding (MoUs) by Haryana’s Micro, Small, and Medium Enterprises (MSME) Department with three companies was signed in his presence, a state government statement said. Industries and Commerce Department Principal Secretary Vijayendra Kumar was also present on the occasion.

  • The products being manufactured by the MSMEs of the state will now be able to be purchased in any corner of the world; this will also increase the export of our country.
  • Haryana government’s primary focus is to promote entrepreneurship, to enhance inclusive and balanced regional development in the state.
  • The strategic collaboration will help MSMEs, artisans in remote parts of the state, to overcome challenges restricting their access to domestic and international markets. This will not only give a boost to sales of existing entrepreneurs but also create unprecedented opportunities for new entrepreneurs.
  • Through this initiative, we are aiming at significantly enhancing visibility of indigenous and specialised products from the state, be it industrial products, or traditional handicraft products, and further strengthening ”brand Haryana”.

Chautala said these MoUs will also create unprecedented opportunities for new entrepreneurs. On the occasion, Kumar said MSMEs are becoming the backbone of the economy. He said the state government is committed to strengthening the existing ecosystem of over 2 lakh MSMEs in the state. Chautala said that in the current competitive era, it is important for MSMEs to adopt new and strategic approaches and added that e-commerce has the potential to take MSMEs to new markets. Gupta said the directorate of MSME is providing all possible help to its entrepreneurs so that they can generate good income from their enterprises and more youth can get employment.

Gupta said the directorate of MSME is providing all possible help to its entrepreneurs so that they can generate good income from their enterprises and more youth can get employment. He added that this pact will help our MSMEs transcend geographic boundaries and reach out to newer markets. “We look forward to creating impact and generate larger market opportunities for our MSMEs.”

He added that this pact will help our MSMEs transcend geographic boundaries and reach out to newer markets. “We look forward to creating impact and generate larger market opportunities for our MSMEs.”

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MSME

MSMEs in India: Govt Aims To Raise MSME Sector’s Share in GDP to 40% From the Current 30% To Benefit Rural Poor, Says Nitin Gadkari

Nitin Gadkari | File Image (Photo Credits: Facebook)

New Delhi, February 7: Union Minister Nitin Gadkari said on Saturday said that the government aims to increase the MSME sector’s share in the GDP to 40 per cent to benefit the rural poor. At present, around 6.5 crore micro, small and medium enterprises (MSMEs) contribute 30 percent to the GDP. While addressing a workshop at the Mahatma Gandhi International Hindi University at Wardha in Maharashtra, Gadkari emphasised that a policy has to be made to empower the poor.

The MSME Minister added saying that village industries and Khadi generate as much as Rs 88,000 crore on an annual basis. “We are not in favour of westernization, but we are in favour of modernization, in the villages. This is the time for socio-economic transformation”, Gadkari said. He said this can be increased if policy is flexible and innovative, and is aimed at improving the life of people living in villages. The minister also stressed that goods produced by village industries can be sold better if they are marketed better.

Gadkari stressed on the point that migration of as much as 30 percent of the country’s population from rural areas has taken place since independence due to lack of growth of the village economy. Gadakri recalled the philosophy of Mahatma Gandhi, Vinoba Bhave, Pandit Deendayal Upadhyaya, Ram Manohar Lohia and Jayaprakash Narayan and said that their aim was the same – to improve the lives of the poor living in villages. “Unless solutions are found to ensure that employment is generated in villages, and they are clean and have enough facilities, the dreams of these leaders will not be fulfilled”, he said.

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MSME Startup

COVID-19 Impact: 78% MSMEs and Startups in India Reduced Workforce in Last 8 Months Since Pandemic Broke Out, Says Survey

Startup (Representational Image Only, Photo Credits: NeedPix.com)

New Delhi, October 20: Ever since the COVID-19 pandemic broke out in India, as many as 78% MSMEs and startups across the country have reduced workforce in the last 8 months. As per a survey by LocalCircles, only 22 percent startups and MSMEs have the same or increased workforce as compared to the pre-COVID levels. According to reports, India’s startups and MSMEs ecosystem went through a torrid time due to the deadly pandemic and lockdown that was imposed across the country. Revenues and operations were severely impacted for most businesses which led to cost cutting and some even shut down temporarily or permanently. Per CMIE, 6 million Indians had already lost white collar jobs in the March – August period.

To understand the impact of the pandemic on startup and MSME, a survey conducted by LocalCircles received over 7,000 responses from startups, MSMEs and entrepreneurs spread across 104 top business districts of the country. In the survey, startups and MSMEs were asked about how have workforce adjustments taken place in their business during the Covid-19 pandemic. In response, 25 percent said their business has shut down and all workforce has been let go, while 15 percent said their workforce has reduced by 50 percent or more.

A 19 percent said their workforce has reduced by 25-50%, and another 19 percent said their workforce has reduced by up to 25 percent. A 6 percent said their workforce has increased and 16 percent said they have same workforce as pre coronavirus time. This shows that 78 percent MSMEs and startups in India have reduced workforce in the last 8 months since the COVID-19 pandemic broke out and only 22 percent startups and MSMEs have the same or increased workforce as compared to the pre-COVID levels.

The Government also took steps to help these small businesses through the Atmanirbhar Bharat scheme, but its advantages per feedback from businesses in July this year has been quite limited, the survey said.

The startups and MSMEs in India were asked about how employment of women has been in their business 8 months into the COVID-19 pandemic. In response, 7 percent said women in their workforce have been reduced by 50-100 percent, 12 percent said women in their workforce have reduced by 25-50 percent, and 12 percent said women in our workforce have been reduced by up to 25 percent. 46 percent said they still have same number of women in the workforce as pre COVID-19. Not a single business reported increase in the number of women employees during the course of the 8 months of COVID-19 pandemic.

This means that 31 percent MSMEs and startups in India have reduced women workforce in the last 8 months. The Labour Force Participation Rate (LFPR) among women in India, is one of the lowest in the world and appears to have slid even further during the COVID -19 pandemic.

In the final question, startups and MSMEs were asked looking at the next 6 months as to how do they see employment of women in their business. In response, 50 percent said they don’t plan to hire any women employees while 30 percent said they plan to hire 1-5 women employees. 13 percent said they plan to hire 6-10 women employees and 7 percent were unsure about it.

 

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Technology

‘MSME Prerana’, an Online Business Mentoring Programme Launched for MSMEs; Here’s All You Need to Know

Online Business
Online Business

Chennai, October 7: ‘MSME Prerana’, an online business mentoring programme for MSMEs by state-run Indian Bank has been launched. The initiative was launched by Union Finance Minister Nirmala Sitharaman on October 6. The online programme will be made available in local languages and is aimed at empowering entrepreneurs through skill development and capacity building workshops. Sitharaman launched the initiative at the Indian Bank’s corporate centre in Chennai.  During the launch, Sitharaman said Indian Bank has taken an out-of-the-box initiative in launching MSME Prerana which will handhold the entrepreneurs through a mentoring program.

The Finance Minister added saying that this novel initiative shall further inspire others in the banking sector to adopt similar measures. Financial Services Secretary Debashish Panda, who also participated in the launch event through video conferencing, delved on the various initiatives taken by the government to support MSMEs.

About ‘MSME Prerana’ Programme:

  1. The ‘MSME Prerana’ initiative is in collaboration with Poornatha & Co, a firm that designs entrepreneurial development programs in vernacular languages using online web-based interactive sessions and case studies.
  2. The first two programs will be in Tamil for the Coimbatore clusters of Indian Bank. It will then be scaled up across the country in Hindi, Telugu, Kannada, Bengali and Gujarati, the Bank statement said.
  3. Spread over 12 sessions, the program enables MSME entrepreneurs to acquire expertise in handling finance and managerial skills, capacity to handle crises in business, understand the dynamics of credit rating and risk management.
  4. While the sessions on managerial and financial skills will be conducted by Poornatha & Co, the banking related topics will be handled by Indian Bank.
  5. MSME Prerana is our effort to bridge this gap in the skill sets. It is a business mentoring program that gives inputs in simple terms (no jargon) and in the local vernacular.
  6. On successful completion of the online programme, all participants would get a certificate, issued jointly by Indian Bank, Poornatha & Co and MADE (Michigan Academy for Developing Entrepreneurs), USA.

The lender’s Managing Director and CEO Padmaja Chunduru said during its outreach programs, webinars and interaction with the bank”s MSME units, one main takeaway was that there is still a lot of dependence on chartered accountants or agents to access bank loans.

Chunduru added that the barriers these MSMEs face include language, confusion about what the bank looks for when they approach for loans, how to manage cash flows, which government schemes are available and suitable for them and how to register themselves for these schemes.

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MSME

MSME Sector to Grow and Contribute to Job Creation With the Help of Structural Reforms Taken by Modi Govt, Says Finance Ministry Report

Business in India | Representational Image Only (Photo Credits: Pexels)

New Delhi, October 6: The Finance Ministry on Monday said that the major structural reforms launched by the Modi government in agriculture markets, labour laws provide unparalleled opportunity for the MSME sector to grow and prosper. These reforms will in turn contribute to job creation in the primary and secondary sectors. A report by the Finance Ministry stated that the historic labour reforms will benefit MSMEs to increase employment, enhance labour productivity and thereby wages in MSMEs.

According to a report by PTI, the Finance Ministry said that important structural reforms that have been taken by the government to ease the risks posed by COVID-19 pandemic will strengthen India’s economic fundamentals and ensure long-term sustained growth. “The enabling policy environment and initiatives taken by all stakeholders to seize the available opportunities will actualise the growth potential of the Indian economy,” the monthly economic report prepared by the Economic Affairs Department of the Finance Ministry said.

The report further said that the sustained spread of the virus poses a downside risk to short-term and medium-term growth rate, adding that the government has strategically undertaken various important structural reforms, encompassing various sectors, to combat these risks. Meanwhile, the implementation of ‘Atmanirbhar Bharat’ package and unlocking of the economy have ensured that economic recovery in India has gained momentum.

The PTI report adds that as on September 25, India’s foreign exchange reserves stood at USD 542.02 billion, equivalent to more than 13 months of imports. India”s probable growth path is visible in this assessment.

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Finance MSME Startup

Ministry of MSME Issues Circular Stating RBI’s Criteria for Classification of Enterprises Under MSMED Act, 2006, Here Are the Details

Ministry of MSME
Ministry of MSME (Photo Credit: PIB)

New Delhi, August 24: The Ministry of Micro, Small and Medium and Medium Enterprises on Monday issued the Reserve Bank of India’s notification for clarifications of small and medium and medium enterprises in the country. The re-classification of MSMEs have been done by the Union government under the Micro Small and Medium Enterprises Development Act, 2006 and is effective from July 1, 2020.

Under the Gazette notification, released by the RBI and reissued by Ministry of MSMEs, several criteria have been mentioned which contains the definition of Micro, Small and Medium Enterprises as per Section 7 (I) of the MSMED Act, 2006.

Definition of MSMEs under MSMED Act:

Micro Enterprise: A firm where the investment in plant and machinery or equipment does not exceed Rs 1 crore. Also, turnover does not exceed Rs 5 crore.

Small Enterprise: A firm where the investment in plant and machinery or equipment does not exceed Rs 10 crore. Also, turnover does not exceed Rs 50 crore.

Medium Enterprise: A firm where the investment in plant and machinery or equipment does not exceed Rs 50 crore. Also, turnover does not exceed Rs 250 crore.

Apart from this, the RBI notification mentioned composite criterion of investment and turnover for the classification of MSMEs. It says that if an enterprise crosses the ceiling limits specified for its present category in either of the two criteria of investment or turnover, it will cease to exist in that category.

The notification said that all the enterprises — whose Goods and Services Tax Identification Number (GSTIN) are listed against the
same Permanent Account Number (PAN) — will be collectively treated as one enterprise. Adding more, it said that the turnover and investment figures for all of those entities will be seen together and only the aggregate values will be considered for classification of MSMEs.

Calculation of Turnover:

For the calculation of investment in plant and machinery or equipment in an enterprise, RBI said that it will link Income Tax Return (ITR) of the previous years filed under the Income Tax Act, 1961. For new enterprises — whose ITR details are not available — the investment will be based on self-declaration of the promoter of the enterprise.

However, those relaxations will end after the March 31 of the financial year in which it files its first ITR. Also, purchase — invoice — the value of a plant and machinery or equipment will be taken into account excluding GST — on self-disclosure basis — if the enterprise is a new one without any ITR.

Among other details, RBI said that it will exclude exports of goods or services or both while calculating the turnover of any enterprise for MSMEs for classification. Adding more, RBI circular stated that information related with turnover and exports turnover for an enterprise will be linked to the Income Tax Act or the Central Goods and Services Act (CGST Act) and the GSTIN. For an enterprise, who don’t have PAN, their turnover will be considered on a self-declaration basis for a period up to March 31, 2021. Following this, PAN and GSTIN will be mandatory.

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Finance Sales Strategy

TReDs Platform Joining Fee Waived For MSMEs till September 20

TReDs Platform
TReDs Platform Joining Fee Waived For MSMEs till September 20 (Photo Credits: Ministry of MSME)

Mumbai, August 18: Narendra Modi government has invited MSMEs to join the Trade Receivables Discounting System (TReDS) platform with zero fees. The free access to the TReDS platform will be there till September 20.

TReDS is an online factoring platform connects buyers, suppliers and financiers. This platform will enable MSME suppliers to get quick access to low-cost finance.

Joining Fee on TReDs Platform Waived till September 20:

Congrats MSMEs !
The fee for joining TReDS platform has been waived. You can get funds against your approved invoices quickly. Register yourself and make your #msmetochampions. @FinMinIndia @sidbiofficial pic.twitter.com/4KdUEyGAaz

— Ministry of MSME (@minmsme) August 17, 2020

What is a TReDS platform?

TReDS is an online mechanism for facilitating the financing of trade receivables of MSMEs through multiple financiers. It also enables discounting of invoices of exchange of MSME sellers against large corporate.

How will MSMEs benefit on TReDS Platform?

Quicker Payment: MSME sellers will receive funds against the approved invoices within 48 hours
Multiple Financiers: MSMEs are not restricted to a single bank. With the help of TReDS platform, they will have the option to choose the lowest bids among the multiple financiers.
Without Recourse Borrowing: There will not be any obligation on the seller to repay the financier. The buyer’s account will be dedicated automatically through a pre-approved NACH mandate.
Lower cost of Funds: Sellers will be able to access financing at competitive terms as it is based on the credit rating of the buyer. The transparent bidding process will help to discover the most suitable price.

 

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Finance Process & Business Expansion Startup Strategy

Emergency Credit Facility Under ECLGS for Small Businesses Hiked From Rs 25 Crore to Rs 50 Crore, NCGTC Modifies Operational Guidelines

MSME (Photo Credits:
Emergency Credit Facility Under ECLG for small businesses hiked from Rs 25 crore to Rs 50 crore by NCGTC. | Representational Image.

New Delhi, August 12: The National Credit Guarantee Trustee Company Ltd (NCGTC) on Wednesday issued a circular regarding the modification of operational guidelines for Emergency Credit Line Guarantee Scheme (ECLGS). The common trustee company informed that the new operational guidelines will now cover individuals and more enterprises amid the COVID-19 pandemic.

Informing about the minutes of the modification of operational guidelines for ECLGS, the NCGTC stated that the upper ceiling of loans — outstanding as on February 2, 2020 — has been increased under the scheme from Rs 25 crore to Rs 50 crore. Apart from this, there has been a hike in the upper ceiling of annual turnover from Rs 100 crore to Rs 250 crore. This has been done in line with the increased ceiling of loans outstanding and revised definition of MSME issued by Union Ministry of MSME.

Among other details, the NCGTC circular stated that there has been an increase in the maximum amount of NCGTC to Member Lending Institutions (MLIs) under the ECLGS. The amount limit has been raised from Rs 5 crore — at present 20 per cent of Rs 25 crore — to Rs 10 crore, which is 20 per cent of Rs 50 crore. However, it has been made clear that those individual loans given for business purposes should fulfil the eligibility criteria prescribed under the scheme.

NCGTC Circular Regarding the Modification of Operational Guidelines for ECLGS:

Earlier on May 23, 2020, the NCGTC was set up by the Ministry of Finance’s Department of Financial Services as a common trustee company to manage and operate various credit guarantee trust funds. It was incorporated under the Indian Companies Act, 1956 on March 28, 2014, with a paid-up capital of Rs 10 crore.

Under the NCGTC, five trust funds currently operate:

1) Credit Guarantee Fund for Skill Development (CGFSD
2) Credit Guarantee Fund for Education loans (CGFEL)
3) Credit Guarantee Fund for Factoring (CGFF)
4) Credit Guarantee Fund for Micro Units (CGFMU)
5) Credit Guarantee Fund for Standup India (CGFSI)

The NCGTC was launched ECLGS on May 23, 2020, for all the financial institutions of India. Among the four key points, which differs it from other schemes include — 100 per cent credit guarantee, zero guarantee fee for banks and customers, pre-approved loans and minimum bank’s risk weight allocation. However, the scheme will continue till October 31, 2020, or till the time Rs 3 lakh crore of the loan amount is sanctioned. The NCGTC has also made it clear that borrowers must be GST registered wherever it is necessary.