‘Small businesses: 1 in 5 fails to pay EMI’

NEW DELHI: With finance being the biggest problem confronting small businesses, nearly one in every five micro and small enterprises failed to pay its loan EMI in September, a survey has shown.
The survey with 17,500 respondents by Consortium of Indian Associations, a trade body that claims to represent 30 trade bodies, showed that in September over half the micro, small and medium enterprises (MSMEs) said their sales were between 25% and 75% of the year-ago level.
Yet, more than half the micro and small enterprises said that finance was the biggest concern, with around 38% of the medium enterprises voicing similar concerns. Irrespective of the size, orders were the second biggest worry.
As a result, loan repayment is a worry. With the loan moratorium ending in August, around 62% of EMI payments were cleared in the first instance after the mandate was presented to the bank, the survey showed. In about 17% cases, the installment was cleared on re-presentation of the ECS or cheque.
“What will happen in October and November EMI payments when the payouts towards bonus, salary advances are going to be high?” CIA convenor K E Raghunathan said.