The Federation of Telangana Chambers of Commerce and Industry has stressed the need for a slew of measures to support micro, small and medium enterprises (MSMEs) as the lockdown affected them the most. In representations to the Union Finance Minister and RBI Governor, following a meeting it organised in which industrialists and members of its expert committees deliberated on problems confronting MSMEs, FTCCI called for a new scheme on the lines of Emergency Credit Line Guarantee Scheme.
It was suggested that the old scheme be merged with a new scheme, as that would extend repayment period.
Also, there was a need to revisit the criteria for NPA classification. “Many micro and small manufacturing firms are unable to realise their dues as per the agreed terms. This is resulting in shortage of working funds and needs immediate attention of government,” a release from FTCCI said.
Further, it said restructuring of loans for MSMEs for 2021‐22 should not be restricted to one-time settlement. The MSME sector is also in need of a reduction in rate of interest. High interest burden and other charges when their revenues and cash flows are less affect the viability of units. Banks should provide need-based working capital based on the enterprises cash flows rather than on the conventional, turnover base assessment.
FTCCI said moratorium on repayment of term loans as well as interest on cash credit accounts should be extended up to March 31, 2022. Other fiscal measures it sought were wage subsistence system and relief from payment of minimum electricity charges. With functioning of the units disrupted on account of COVID-19 second wave, it is becoming a challenge for the companies to ensure filing of returns and statutory compliances on time. Therefore, the government may consider relaxation of statutory compliances during this period, the release said.
