FTCCI pleads for immediate financing support for MSMEs survival

Hyderabad, May 27 (UNI) The Federation of Telangana Chambers of Commerce and Industry (FTCCI) on Thursday urged the government for immediate financial support for MSMEs, the most affected due to imposing either full or partial lockdown by several states in the light of Covid-19 second wave.
FTCCI with various industrialists and entrepreneurs with FTCCI expert committees at a meeting held here to deliberate on the problems confronting MSMEs, discussed various issues and submitted a representation to the Union Minister for Finance and also to Governor, RBI seeking relief to the MSMEs, which are passing through a very critical phase and a slew of measures are required to support for the survival.
Besides requesting for a new scheme on the line of the Emergency Credit Line under Guarantee Scheme which provides comfort to the MSMEs, they also suggested that the old scheme may be merged with a new scheme to support the industry since repayment and gestation period are more.
Banks need to be flexible in declaring assets as NPA, they said that there is a need for revisiting the criteria for NPA classification.
Many Micro and Small manufacturing firms are not able to realize their dues as per the agreed terms and this is resulting in a shortage of working funds and needs immediate attention of the Government, they also requested.
Restructuring of loans by MSME for the year 2021‐22 should not be restricted to one-time settlement, the MSMEs sector is requesting a steep reduction in the rate of interest.
High-Interest burden and other charges when the revenues and cash flows are low are standing as hurdles for the viability of units, they said in their letter.
Moreover, it is time that Banks should provide need-based working capital based on their cash flows rather than on conventional turnover base assessment, they said it is time to infuse liquidity in the whole system.
Moratorium to be extended up to March 31, 2022, on all the EMIs of Term Loans as well as interest on cash credit accounts, the industrialists urged the government and said that all measures in this regard should mutatis mutandis be made applicable to the NBFCs as well duly ensuring that there is no liquidity crunch
Apart from the monetary relief, the Finance Minister is requested to provide fiscal incentives which include relief under GST namely allowing input credit without restrictions-input credit on capital goods on purchase, reduction in GST rates where feasible to boost demand, they also requested.
Among fiscal measures it is sought to ask for a wages subsistence system- social security measures like PF without limitation and restriction- relief from payment of minimum electricity charges, they also urged the government.
FTCCI President Ramakanth Inani, Senior Vice- President K. Bhasker Reddy, Vice-President Anil Agarwal, Chairpersons of various expert committees and various industrialists and entrepreneurs participated in the meeting.