New Delhi: Union Minister of State (MoS) Finance Pankaj Chaudhary has appreciated PHDCCI suggestions like collateral free loan to MSME up to 5 crore, help desk for people seeking loans and taxing registered MSMEs at a flat 25% rate.
The Minister was addressing the Conference on MSME Financing: A Key Driver for Viksit Bharat 2047 & PHDCCI’s 1st MSME Banking & NBFC Excellence Sammaan–2025 held at PHD House, New Delhi held Monday, January 20, 2025.
Prime Minister Narendra Modi has prioritized infrastructure development, increasing spending from Rs 5 lakh crore to Rs 11.11 lakh crore, he said emphasizing the need for growth in every sector of the economy, aligning with the vision of Viksit Bharat 2047 of the PM.
Under the Mudra Yojana, more than 31 lakh loans have been disbursed, with over 60% of the beneficiaries being women. Furthermore, 55 crore Jan Dhan accounts have been opened, of which 55% belong to women, he added.
He congratulated the PHDCCI on completing 120 years and acknowledged its role in providing a shared platform to strengthen the backbone of our economy, which are MSMEs.
To make industries more efficient, the government has abolished 1,500 unnecessary laws and initiated steps to promote MSMEs. Over the last 10 years, there has been a noticeable change in the government’s approach toward industries; the cost and time for businesses have reduced significantly.
Concluding his address the Minister emphasized that achieving the goal of making India a developed nation by 2047 will require a significant contribution from the MSME sector.
On the occasion, Dr. Ishita Ganguli Tripathy, Additional Development Commissioner, Ministry of MSME, Government of India informed that 5.86 crore enterprises have registered on the Udyam portal till now which drives employment of 24.8 crore persons.
The formalised identity enables enterprise to avail the benefits focusing is on upward mobility. In 2022, a notification was brought out which entailed that previous category and benefits could continue after 3 years. More than 5 lakh enterprises have availed this and grown.
She informed that under the Credit Guarantee Scheme for MSEs, women-owned enterprises have seen a 90% increase in credit guarantees. From 2000 to December 31, 2024, approximately 1.01 crore guarantees have been approved. Under the Self-Reliant India Fund, equity funding support has been provided to MSMEs. A total of 59 Daughter Funds have been empanelled; 533 MSMEs have been assisted; approximately Rs 9,999 crore have been invested in MSMEs. The average investment has been around Rs 19 crore.
Shachindra Nath, Chair, BFSI Committee, PHDCCI & Founder and Managing Director, UGRO Capital discussed that unsecured loans are critical for MSMEs in India, as many of these businesses, particularly first-generation enterprises, lack access to adequate collateral.
Dr. Ranjeet Mehta, CEO & Secretary General, PHDCCI deliberated that there were three critical challenges for MSMEs – financing, market access, and access to technology. However, when the financial challenge is resolved to a great extent, the others can be easily sorted out. Another Key issue he addressed was the scheme of collateral free loan to MSME up to 5 crore but in practical most of banks ask for collateral security for giving loan, here PHDCCI suggest if there can be a help desk for people seeking loans it can be sorted out.
Secondly, the corporate tax rate is around 25%, but the MSMEs, especially proprietorships and LLP firms, are taxed at 33%. He requested that registered MSMEs be taxed at a flat 25% rate. Lastly, he emphasized on Priority Sector Classification for credit to MSMEs through NBFCs.
