MSME: Need a Loan, Then Apply Immediately

Dr. Viibhor Agarwal

The government is unlikely to extend the Rs 3 lakh crore Emergency Credit Line Guarantee Scheme (ECLGS) from October 30 to the MSME (micro, small and medium enterprises) sector. However the loan amount so far passed under ECLGS is around 65 percent. That is, out of Rs 3 lakh crore, only 65 percent loan has been approved so far. Therefore, if you want to take a loan under ECLGS, then you must apply by October 30. The scheme aims to provide financial support to businesses. Among them, especially the MSME sector, which has been greatly affected by the corona virus epidemic.

Why it will not proceed According to the report of Scheme ET, it is intended to help all the businessmen affected by Corona and there is no need to pursue the scheme if there are no borrowers under the scheme. On 1 August, the government expanded the scope of the scheme. Professionals like doctors, lawyers and chartered accountants were also included in the loan scheme. The limit for outstanding loans was increased Under this scheme, the limit of outstanding loans for any firm was fixed, but later the limit of outstanding loans was doubled so that more firms could take loans. The greatest measure of Guaranteed Emergency Credit Line (GECL) was expanded from Rs 5 crore to Rs 10 crore under this plan. In the wake of the Covid pestilence, the administration reported a financial bundle of Rs 20.97 lakh crore, which included ECLGS. How much advance has been given So far, banks and non-banking money related organizations (NBFCs) have affirmed advances worth about Rs 1,87,579 lakh crore, while credits worth Rs 1,36,140 crore have been dispensed. On 20 May, the Cabinet endorsed extra financing of up to Rs 3 lakh crore for the MSAE area through ECLGS at a concessional pace of 9.25 percent.

Credit Scheme: MSME can continue to get loan even after October

There is good news for the MSME sector. The government is planning to extend the deadline for the Rs 3 lakh crore Emergency Credit Line Guarantee Scheme (ECLGS) introduced for the MSME sector. This means that the MSME sector can continue to get loans under ECLGS after October. Under this plan, an advance of Rs 3 lakh crore was reported till October 30. But now its deadline can be extended further.

What is the reason the government wants to increase the liquidity for the MSME sector. That is why ECLGS wants to move forward. Statistics show that till October 5, loans worth about Rs 1.87 lakh crore were sanctioned under credit of Rs 3 lakh crore, while loans worth Rs 1,36 crore were disbursed. For your information, let us tell you that ECLGS was the largest part of the Rs 20 lakh crore self-sufficient India campaign package. A special campaign being run According to the report of Indian Express, National Credit Guarantee Trustee Company (NCGTC), which is implementing the scheme, is running an aggressive campaign this month to increase funding for MSMEs. The campaign was launched on 23 May. At the time of the announcement of the scheme, it was said that ECLGS will continue till October 31 or till the sanction of loan of Rs 3 lakh crore. According to an official open to individual borrowers too, NCGTC is putting great emphasis this month to reach the maximum number of people. Explain that initially this scheme was introduced only for small firms. But later it was started for individual borrowers as well. If the loan up to Rs 2.90 lakh crore has also been passed under this scheme, then the scheme can be extended further.

SBI and HUL hold hands to give simple advance to MSME

  • The country’s largest bank SBI has taken several steps to give loans to MSMEs (Micro, Small and Medium Enterprises). Even SBI is at the forefront of providing loans to MSMEs under the Emergency Credit Scheme of the government. Now SBI has taken another step to provide easy loan to MSME firms. The bank has joined hands with FMCG giant HUL (Hindustan Unilever). Through this partnership, small retail vendors will be given loans easily. Small businesses will be helped to gain easy access to credit. SBI and HUL together will help small businesses go digital to survive in the new world.

 

  • Advantage from HUL’s application Under the association, HUL’s retailers who utilise the organisation’s Shikhar application will have the option to profit the credit office to pay merchants. The app has been integrated with the SBI Yono app to give them this advantage. According to HUL chairman and managing director Sanjeev Mehta, there are close to 1 crore retailers in India. But due to working in unorganised sector, they face difficulties in getting loans. They have additionally been hesitant to embrace advanced innovation.

 

  • According to Mehta, the credit problem will be overcome, through partnership with SBI, efforts will be made to solve many problems faced by retailers and small shopkeepers in the country. SBI has agreed to provide uninterrupted and easy credit to retailers. There will be no paperwork required. This will allow the retailers to get credit in a very quick and very easy way. They believe that this is going to be a tremendous game-changer move.

 

  • What is HUL’s Pinnacle App HUL’s Pinnacle App allows retailers to place orders without having to go to the store without salesmen. This app has proved to be a huge boon for millions of retailers across the country in the Corona crisis. One of the objectives of the partnership between HUL and SBI is to make retailers accept technology. With this, they will be able to use technology easily for more things.

 

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