What are the various benefits and schemes for MSME for COVID -19?
During this outbreak of COVID 19, it has lead to a massive breakdown in the breakdown in the economy. But to cope up with these consequences, the government has launched some schemes for MSME.
The Minister, Nitin Gadkari has asked all the officials to copy down the strategies for these economic opportunities, which will lead to a rise in MSME after the COVID-19 ends.
RBI has launched relief measures and the minister has announced that all these benefits should reach to all the MSMEs.
RBI has also announced that all term loans i.e. retail and crop loans have to be covered by the 3 months suspension.
Gadkari has also stated for the industrialists to take the full advantage of the schemes.
RBI has launched 1,00,000 Crore Long Term Repo Operations, this will help banks increase the lending capacity at a low rate.
Finance Minister has extended the date of filing the Income Tax for all the businesses.
Credit lines have been introduced by various public sector banks, as a relief measure. Under this, the MSME borrowers can use the maximum loan amount of Rs200 crores, which is 10 % of the existing fund.
The Small Industries Development Bank India under the SIDBI Assistance has declared a concessional interest rate of 5% for MSME loans.
The consequences of COVID -19 has led to a tight situation for all the business firms and by these measures and schemes, the government can settle the MSME segment.
What are the various loan schemes for MSME during COVID -19?
What are the various loan schemes for MSME during COVID -19?
Under such a condition where the world is suffering from the adverse effects of the COVID -19. There are various loan schemes introduced to benefit the MSME. These schemes are-
SBI has taken a step ahead to expedite all the instalment and interest on term loan which are falling during 1st March and 31st May. Another step is taken to extend the repayment period to 3 months above the original payment.
2. Working capital:
In work capital, the government has sanctioned this in the form of cc/od. all the interest which is applied between 1st March 31st May shall be defeated entrance along with it should be repaid after the maturity period.
What relaxation is provided for MSME during COVID-19?
India is handling an outbreak of COVID-19 consequences by using extraordinary healthcare products and economic measures. The intervention of relief will help to minimise the damage to lives and livelihoods permanently. MSME is providing instant attention to work.
For MSME loans SIDBI has launched and helpful scheme of interest rate 5 people under the SIDBI assistance. This provides a loan within 48 hours without any collateral support and paperwork.
the support is only given to those units who are delivering the products which are related to COVID-19.
Government has extended the payment date of GST to June 2020 without any late fee.
Providing the wages to the workers who work in such units.
If any sort of compensation is provided to MSME they have to provide a cash flow statement for a period of time.
Due to extension of the lockdown the property tax, rent and other utilities will shortfall.
Paying PF to the workers of the company who has less than a hundred workers.
How has the government extended the support to MSME during COVID-19?
Government support extended to MSME during the COVID 19
MSME stands for Micro Small and Medium Enterprises. The RBI and the government have made plans to reopen manufacturing activities after 28 but due to saviour effects of the corona, it may be possible that may be extended. The factory owner will face operational hurdles. The small firms have faced the problem of cash because the manufacturing process has stopped so it is very difficult to maintain the payment of workers and staff members. As per MSME if the industries open that will helps to recover from economic issues. The Confederation of Indian Industry (CII) recommended increasing finance MSME. The CII also focusing on moratorium and wage support. Which mean giving related to the public for wages and loan.
Many MSME is the most important part of the supply chain.They are supplying various products to various larger firm so it is necessary to open MSME. If MSMEs are reopened then it is will be helpful for the country in the following ways .
Production will be increased: if the MSMEs are reopened then it will be helpful for the country to increase the production of various products.
Cost of the product will be reduced: if the MSMEs are reopened then more products will be produced in the industries, as a result, the cost of the product will be decreased.
A small firm will be able to provide wages to their workers: Many people in the country depend upon the small scale industries if they are open so then the production of the product will be increased if production increases then it will be offered more product sell in the market, if more product is offered for sell then more workers are required for job and firms are able to provide wages to there workers.
Positive Effect on the economy: MSMEs Have a big contribution to the economy so, if MSMEs are open then automatically there is a positive effect on the economy.
The MSMEs of any country is helpful for the economy but now the problem of COVID 19 many people of the country are suffering from various issues like wages, foods, medicals, etc. Hence, the government focusing on MSMEs to recover from these issues that why the government focuses on MSMEs. That may be possible the MSMEs will be functioning properly and the economy will be recover soon.
How can a businessman avail various government schemes during COVID -19?
In such a situation of crisis, where a disease like COVID -19 has stopped the working of the world and has affected the lives of people in various ways. A large number of deaths in the world has lead to slowing down of the Global Economy. There are various schemes introduced by the government to support the businessmen so that they can continue with the work. These schemes help them to not only improve business but will provide them with support during such a situation of crisis. The government of India has worked since the lockdown commenced on various issues The government has taken so much initiative for small scale industries as well as for various firms and businesses. The government not only focusing on businessmen but also focus on the poor’s to provide wages and foods. The package government announced for Poor’s, worker, and other rs 1.70 lakh corer. As per the Pradhan Mantri Garib Yojna ensures that no one is hungry during the corona. Small Industries Development Bank of India (SIDBI) helps to provides financial helps to all businesses for financial stability and for new start-ups. They are good finance, especially new start-up businesses. Here are some of the scheme which the businessman can use to get the benefit.
COVID-19 Start-up Assistance Scheme (CSS’). This scheme will provide finance for innovative business start-ups that will help to improve e the role of this scheme to provide financial stability and finance for the business firms. The primary object of this scheme is to provide quick working capital for the next 45 to 90 days for a start-up. This committee required 5 members from (SIDBI 03 and 02 from venture capital).
Next one the Reserve bank of India initially introduce the Long Term Repo Operations (LTRO) worth Rs 100,000 crore that will helpful for banks to provide lending with cheaper interest rate.
The finance minister of India also announced to extend the income tax return for all business till 30 June.
Company affirmation of readiness towards COVID -19 web form
A simple web form named CAR has been bifold by the ministry of corporate affairs. This form substantiates their zeal to deal with the threat of COVID -19. This do needs to be filled by the authorities of the company.
GST and indirect tax measures
The government of India has given the advantage by increasing the date of filing GST and that too without any penalty.
Relief measure for corporate affairs
Government has set many relief measures and expansions of deadlines. If any document which requires to be filed in MCA 21 registry, will not have any penalties up to 30 September 2020.
The board meetings are postponed for the next two quarters.
Auditors report will be formed in the year 2020 -21, this will reduce the burden on company and auditor.
It is mandatory to create a deposit reserve of 20% during the year 2020-21. The maturity of this has to be extended to 30 June 2020.
Schemes to support MSMEs
Those MSMEs which are providing services and manufacturing goods in the time of COVID-19 can avail the loan of 5%.
These schemes can help the businessman to avail benefit. It is the initiative by the government to support the businessman and to support them during the time of COVID-19 crisis.
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