RBI board meet may find common ground on MSME - Article published by TOI
Dear all,
Your association is forwarding herewith an article published in Times of India, Mumbai Edition on dated 16.11.2018 regarding RBI board meet may find common ground on MSME.
As per the article, the Reserve Bank of India (RBI) and the government are likely to find common ground on the issue of relief to micro, small and medium enterprises (MSMEs). There are also indications that the central bank will examine some of the proposals made by the government, thereby staving off invocation of the never-used Section 7 of the RBI Act by the Centre. According to sources, providing funds to MSMEs is a priority area for the Modi government, given the sector’s contribution to employment generation. It is seen as one of the four-five crucial issues in the November 19 meeting of the central board of the RBI.
Several MSMEs are facing stress because of GST and demonetisation. While there have been concerns that the RBI’s tough stance on bad loan norms may choke credit to this sector, sources point out that most of the central bank’s rules do not apply to this segment and there is a separate relief and rehabilitation framework that allows for restructuring of loans to stressed small borrowers.
“The February 12 circular, which does away with loan restructuring, applies to loan accounts of over Rs 25 crore. Almost all the small businesses are excluded from this circular,” said a source. The RBI had in 2016 formulated a package that allows for banks to devise their own restructuring scheme for small businesses and provide additional working capital, if required.
For more detail, please go through the full article attached herewith.
This is for your kind information.
Thanking you,
With regards,
For Silvassa Industries & Manufacturers Association,
Narendra Trivedi,
Secretary
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