NEW DELHI: Commerce and Industry Minister Piyush Goyal on Thursday urged the industry to share specific issues they are facing in accessing bank credit and suggested that the government is open to exploring alternate financing models for MSMEs.
He also said the ministry can earmark particular areas in the proposed industrial townships for the MSMEs (Micro, Small, and Medium Enterprises).
Exporters have raised concerns over declining bank credit, particularly to the MSME segment.
While exports grew by 15 per cent in the rupee terms between 2021-22 and 2023-24, the outstanding credit in March 2024 dropped by 5 per cent over the same month in 2022, according to exporters.
“Give me specific details (as in) what kinds of problems they (MSMEs) face.
Is too much collateral being asked?
Suppose an ECGC (Export Credit Guarantee Corporation) cover is available, do they (banks) still ask for collateral, what kind of interest they charge when a 90 per cent guarantee is taken by ECGC in the event of any failure of export credit?
“If we get that more specific feedback then we will be able to take it up with the bankers. ECGC is looking at factor services also but my own personal view is that being costlier, people will still prefer to go to the bank and take a loan but we are open to the idea of alternate financing models,” he said here at a function.
In August, the cabinet approved 12 new project proposals under the National Industrial Corridor Development Programme (NICDP) with an estimated investment of Rs 28,602 crore to set up industrial parks/townships in the country.
These industrial areas will be located at Khurpia in Uttrakhand, Rajpura-Patiala in Punjab, Dighi in, Maharashtra, Palakkad in Kerala, Agra and Prayagraj in UP, Gaya in Bihar, Zaheerabad in Telangana, Orvakal and Kopparthy in AP and Jodhpur-Pali in Rajasthan.
“I am happy to commit to a particular area earmarked for MSMEs because without MSMEs no large industries will survive.
With inputs from PTI
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