While noting the concerns raised by Micro, Small and Medium Enterprises (MSMEs) in a meeting held, Union Minister of MSME Nitin Gadkari said that the sector is facing lot of problems because of delayed payments.
A meeting was held today with representatives of MSMEs which was Chaired by Union Finance Minister Nirmala Sitharaman.
Gadkari requested the Finance Minister to find a solution to the problem of delayed payments to ensure MSMEs get paid within 45 days.
On delayed payments, Sitharaman said that she has instructed the officials to segregate the pending payments in 2 parts- one, where there is no litigation and second where there is litigation.
She further instructed to ensure payment in latter case within a time bound frame.
She also asked the officials to review the 59 minute loan scheme because while the ‘in-principle’ approval is given quickly, the number of disbursals are not encouraging.
She stressed on the need to find the causes.
During the meeting, Secretary General of Federation of Indian Micro and Small and Medium Enterprise (FISME) Anil Bhardwaj highlighted the issue of arbitrary increase in claim period of Bank Guarantees by banks.
He said, “It is an extremely regressive decision recently by banks that now even if one is required the bank guarantee for three months, one has to pay for 15 months! It will choke the working capital and would put unnecessary burden on MSMEs.”