The new definition of micro, small and medium enterprises (MSMEs) that includes both turnover and investment limits has made processes simpler and will lead to improved credit flow to the sector, according State Bank of India chairman Rajnish Kumar, who recently addressed a session organised by the Confederation of Indian Industry (CII) on International MSME Day. Kumar said that the credit guarantee scheme for MSMEs under the ‘Atmanirbhar Bharat’ mission will reduce the pain of the sector, which has come under stress in the aftermath of COVID-19-induced crisis.
SBI is the largest lender to the sector and is increasingly utilising digital technology platforms to enable hassle free credit flow to such industries, he added.
New CII president Uday Kotak said MSMEs need risk capital to grow and CII would help them in strengthening their ‘internal housekeeping’ so that they can get better access to credit at competitive rates. MSMEs need to be better educated so that they understand how to access formal credit and the requirements to access formal credit, Kotak was quoted as saying by a CII press release.