Google News

Union Budget 2023: MSMEs to be benefited from the new budget

Must Read

Revamped credit guarantee schemes for MSMEs will enable additional collateral-free credit of Rs 2 lakh crore to them while the cost of credit will be reduced by 1%

New Delhi: Finance minister Nirmala Sitharama, in her budget 2023 speech on Wednesday, announced revamping of the credit scheme under Credit Guarantee Trust for micro, small and medium enterprises (MSMEs) with the infusion of Rs 9,000 crore in the corpus, with effect from April 1, 2023.

“Last year, I proposed extending the credit guarantee scheme for MSMEs. I am happy to announce that the revamped scheme will take effect from 01 April 2023 through an infusion of Rs 9,000 crores in the corpus,” said the Finance Minister.

This will enable additional collateral-free guaranteed credit of Rs 2 crore and reduce the cost of credit by 1%, added Sitharaman in her speech.

“The revamped Credit guarantee for MSMEs and additional infusion of Rs 9000cr is great development for MSMEs that are still recovering from the impact of pandemic,” said Arvind Mediratta, managing director & chief executive officer of METRO Cash & Carry India.

“With the much-needed push that will aid in their recovery following the Pandemic’s aftermath, MSMEs will prosper. This should put an end to their struggle and distress position in the market with the aim of increasing money availability and accessibility to the MSME sector,” said Anshita Mehrotra, founder of Fix My Curls.

“In fact, in my opinion, the budget helps ease the bankers’ concerns about lending money to MSMEs because of the absence of collateral,” added Mehrotra.

Along with this, there are other benefits for MSMEs which include voluntary settlement schemes and the expansion of Fintech-enabled schemes.

Also, the government has provided relief to MSMEs by announcing the Vivad se Vishwas scheme. Under this, in cases of failure by MSMEs to execute contracts during the Covid period, 95% of the forfeited amount relating to bid or performance security, will be returned to them by government and government undertakings.

Tax relief has also been provided to MSMEs. The finance minister announced that micro-enterprises with a turnover of up to Rs 2 crore and certain professionals with a turnover of up to Rs 50 lakh can avail the benefit of presumptive taxation.

“I propose to provide enhanced limits of Rs 3 crore and Rs 75 lakh respectively, to the taxpayers whose cash receipts are no more than 5%. Moreover, to support MSMEs in timely receipt of payments, I propose to allow a deduction for expenditure incurred on payments made to them only when payment is actually made,” added Sitharaman.

Latest News

50% of our new clients are now through recommendations: Nikhil Aggarwal, founder, CRA Realtors

Nikhil Aggarwal talks about his journey, achievements and upcoming projects  New Delhi: Nikhil Aggarwal has been an advisor to 400...