Scheme seen as incentive to lenders
The Federation of Indian Chambers of Commerce and Industry (FICCI) said the move by Reserve Bank of India (RBI) to provide a loan-restructuring window for Micro, Small and Medium Enterprises (MSMEs) will provided a much-needed boost.
“This will provide a much-needed boost to the small and medium enterprises that had been reeling under financial pressures on account of reasons beyond their control,” said Sandip Somany, President, FICCI.
RBI is providing restructuring for loans up Rs.25 crore.
MSMEs are the backbone of the Indian industry, but generally face greater vulnerability on account of the payment mechanisms which came under greater stress in recent times, FICCI pointed out.
The tight liquidity situation in the financial markets only exacerbated the problems faced by the MSMEs and a measure like the one announced by RBI was clearly needed to support these units.
“The relief comes at the right juncture and will provide the much-needed momentum to push the growth levers as MSMEs make a significant contribution to domestic output, exports as well as job creation,” said Somany.
“The RBI scheme should provide an incentive to the lenders to look at restructuring of the loans extended to MSMEs in a more pragmatic manner and we hope that it will also expedite decision making in this regard,” he said.
RBI’s relief window for MSMEs together with other measures announced by the government for easier and affordable access to credit such as interest subsidy on loans should help in reviving growth of MSMEs and provide an added impetus to push the overall growth of the economy upwards of 8%. fiinews.com