The importance of transparency of accounts, certifications and tax payment and their role in the growth of the company in the long run was explained to the Micro, Small and Medium Enterprises (MSMEs) in a programme on “Secrets of Success for Small and Medium Business”. It was organised by India SME Forum here on Friday.
Industry experts, representatives from banks and rating agencies dwelt in great detail on setback that industries would face when they maintained multiple bank accounts — in a bid to escape from paying heavy taxes.
“Some companies that recorded about 24 per cent profit projected only 2 per cent of profit to escape tax payments,” the experts observed.
They explained that this would result in banks turning down proposals to obtain loan that was submitted by such companies — and become a setback for the growth of the company.
“These practices make prospective investors refrain from investing in such companies though they were performing well,” they added.
President of the Salem District Small and Tiny Industries Association, K. Mariappan, emphasised the need for rating MSMEs.
“Rating is not only for obtaining loans but also helps the companies know where they stand in the industry and their standards,” he said and explained the other advantages of rating in taking small industries to the next level.
Experts also took part in interactive sessions on “Towards a Sustainable Financial and Economical Ecosystem for SMEs” and on “Reaching Your Customers, Branding and Managing Growth for Profitability”.
During an interactive session, benefits extended to first generation entrepreneurs by the government, banks and industrial forums were explained. The queries raised by entrepreneurs were also clarified.
Director General of ISME Forum Sushma Morthania said that the MSME sector in India is essential to achieve the targeted growth rate of India.
“It opens opportunities to nurture budding entrepreneurs and to incubate innovation at the elementary level. Growth in the SME sector ensures industrialisation in backward areas and indicates more equitable return from future growth perspective,” she said.
She said that the programme was organised to establish more SMEs and promote and propel entrepreneurial movement across India.
The forum brings together Small and Medium entrepreneurs on a knowledge sharing platform with experts and mentors to support them growth in their line of business. Such programmes have been organised in Noida, Gurgaon, Faridabad, Baroda, Ahmedabad, Rajkot, Kochi and Coimbatore.