India – MSME (Ministry of Micro Small and Medium Enterprises)

This Sector consisting of over 36 million units, as “MSME at a Glance Report 2016” of GOI, provides employment to over 80 million persons. The Sector through more than 6,000 products contributes about 8% to GDP. Some of the Key challenges and opportunities that remain for them are – 1. Ease of credit access and quick finance 2. Unavailability of modern, affordable technology 3. Lack of basic infrastructure facilities. Of course, the list can go on. In this context it is important the MSME know the schemes available to them from the Ministry.


Performance & Credit Rating Scheme

Under this Scheme, rating fee payable by the micro & small enterprises is subsidized and that is subject to a maximum of 75% of the fee or Rs. 40000/-, whichever is less.

Credit Guarantee Scheme (CGTMSE)

To make available credit to Micro and Small Enterprises for loans up to Rs. 100 lakh without collateral/ third party guarantees. The credit Guarantee under CGTMSE seeks to reassure the lender that, in the event of an MSE unit, which availed collateral free credit facilities, fails to discharge its liabilities to the lender; the CGTMSE would make good the loss incurred by the lender.

Credit Linked Capital Subsidy Scheme (CLCSS)

To facilitate technological upgrade, the Government of India has been implementing the Credit Linked Capital Subsidy Scheme (CLCSS).

The scheme is applicable to new and existing Micro & Small Enterprises(MSEs) engaged in manufacturing.

Facilitating 15% upfront capital subsidy to a maximum limit of Rs.15.00 lakhs (investment in approved plant & machinery up to Rs.1.00 crore) for induction of well-established and improved technologies.

MSME’s may engage experts in the respective field or approach the Udyami Helpline to know more. Details of all the schemes are available on MSME websites.The Companies that leverage their strength and remain ahead of intense competition should use technology to forge ahead. Having the right talent, adequate funds and global quality approach would be key to their success.

Mahesh Krishnamurthy

Author: Mahesh Krishnamurthy is Business Finance Strategist, Mentoring Business Strategy, Turnaround Specialist, Project Finance & CFO Services Specialist.

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