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Loans for MSMEs in 59 minutes

Boost to trade:PM Narendra Modi and Finance Minister Arun Jaitley at a press meet in New Delhi on Friday.R.V. MoorthyThe Hindu

Boost to trade:PM Narendra Modi and Finance Minister Arun Jaitley at a press meet in New Delhi on Friday.R.V. MoorthyThe Hindu  

Prime Minister Modi unveils a slew of measures to stimulate the sector

Prime Minister Narendra Modi on Friday announced 12 measures to boost the Micro, Small and Medium Enterprises (MSME) sector, including a portal that would enable the units to get a loan in just 59 minutes and interest subvention of 2%.

“In the time taken for you to reach your office, you can now get a loan,” he said. “We had run a pilot and I had set a target of 72,000 MSMEs. As of today, 72,680 have been on-boarded.”

The Prime Minister said firms registered on the Goods and Services Tax portal would be able to avail themselves of this facility on the portal itself. “When you file GST returns, you will be asked if you want a loan,” Mr. Modi said. “GST-registered firms will also get a 2% rebate on interest rates. Being a part of the GST and being an honest taxpayer will become your strength.”

Mr. Modi said public sector companies had now been asked to compulsorily procure 25%, instead of 20%, of their total purchases from the MSMEs. He said that of the 25% procurement mandated from the MSMEs, 3% must now be reserved for women entrepreneurs.

Interest subvention

Also, Mr. Modi announced a 2% interest subvention on fresh or incremental loans for all GST-registered MSMEs. “These 12 decisions will mark a new chapter for the MSME sector,” he said.

The Prime Minister recalled India’s strong traditions of small scale industries, including Ludhiana’s hosiery and Varanasi’s saris.

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