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One of the major problems faced by micro and small entrepreneurs in Peenya is likely to be resolved in the near future. Hon’ble Minister of State for Finance Sri Arjun Ram Meghwal at a seminar held recently on Credit flow to MSME Sector assured the small industry fraternity that steps would be initiated to reconsider extending the NPA norms from 90 days presently to 180 days.
Reacting to this, Sri R. Krishna-murthy, President, PIA, said the relaxation of NPA norms would greatly relieve the small entrepreneurs. “We are certainly going to follow up with the government to make sure that the assurance becomes reality at the ground level. Our demand for extending the NPA norms is perfectly valid as the MSMEs generally do not receive their payments before 180 days. So it is unfair and unrealistic for the lending banks to expect their MSME borrowers to repay their dues even before they receive their outstanding from their purchasers.”
Presently, any outstanding liability beyond 90 days is considered as Non Performing Asset (NPA) and attracts stringent recovery action and harassment from banks. Given the fact that MSMEs generally have book debts in their books that are 4-6 months old, the 90-day NPA norm will end up in even a performing MSME into a non-performing asset. In another major announcement, the Minister stated that all Schemes and Benefits available to MSMEs can be accessed online to encourage the ease of doing business. All these measures are likely to be rolled out in a month’s time. So let’s wait and watch – and hope for the best.
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