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    MSMEs may get up to Rs 1 lakh crore salary support

    Synopsis

    MSME’s have been at the core of financial package of the Modi government, which in May announced a Rs 3 lakh crore ECLGS under which 100% guarantee coverage will be provided by the National Credit Guarantee Trustee Company for additional funding of up to Rs 3 lakh crore to eligible MSMEs.

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    Last week, the finance ministry said banks had sanctioned loans of about Rs 1.2 lakh crore under ECLGS.
    NEW DELHI: The government is discussing ways to boost consumer demand in the economy, with one option being the possibility of providing salary support of up to Rs 1 lakh crore over the next three years to MSMEs which employ a certain minimum number of employees, as a way to boost demand in the economy.

    “This is one way to boost the demand in the economy which has been suffering,” a senior government official told ET. At present there are close to 6 crore MSME’s in the country and they form the backbone of the economy, the official said.

    The official added that a minimum number of employees hired by the unit could serve as selection criteria and the support could be extended for up-to three years.

    MSME’s have been at the core of financial package of the Modi government, which in May announced a Rs 3 lakh crore emergency credit line guarantee scheme (ECLGS) under which 100% guarantee coverage will be provided by the National Credit Guarantee Trustee Company for additional funding of up to Rs 3 lakh crore to eligible MSMEs and interested Micro Units Development and Refinance Agency (MUDRA) borrowers in the form of a guaranteed emergency credit line (GECL) facility.

    Last week, the finance ministry said banks had sanctioned loans of about Rs 1.2 lakh crore under ECLGS. However, disbursements against this stood at a little over 61,000 crore till then.

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    10 Comments on this Story

    Jagmeetsingh Dumra20 days ago
    banks are sorting out good accounts and offering them only covid loan
    Shri Mahesh22 days ago
    time to move Indian msme into high tech and high value products. make smart products in solar energy and health care.
    Hemang soni24 days ago
    I Am planning for clinical trials for my 12 year old ayurvedic products , but as a msme there are no benefits for such 7lac huge expense per product. As per me , government must think positive for this on urgent basis
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