shine india monthly magazine Published this article page no 22 The new guidelines make wholesale and retail enterprises eligible for registration on Udyam portal. o Udyam portal simplifies the process of registering any enterprise under the MSME category through a singlepage registration. Wholesale and retail traders will now be eligible for finance under priority sectors classified by the Reserve Bank of India (RBI). o No other benefits of small business are extended to wholesale and retail enterprises. In the past wholesale and retail trading activities were classified as MSMEs but were excluded in 2017 as they did not cater to manufacturing activity. MSMEs and their Importance in India MSMEs introduced by the Government via Micro Small & Medium Enterprises Development (MSMED) Act 2006 are entities engaged in the production manufacturing processing or preservation of goods and commodities subject to investment limits (refer infographic). They contribute to 30% of the countrys GDP 45% of manufacturing output and about 40% of overall exports. There are approximately 6.3 crore MSMEs employing 110 million people. Recent Government Initiatives to support MSMEs New Definition In 2020 the Government has revised the definition of MSMEs by o Eliminating the distinction between manufacturing and services enterprises o Investment criteria for such enterprises have been revised upwards with introduction of additional criterion of turnover. It will give MSMEs the confidence to grow and remove MSMEs fear of losing benefits of MSMEs if they outgrow in size. Improved Credit Access by extension of the Emergency Credit Line Guarantee Scheme (ECLGS) allowing fully guaranteed and collateralfree additional credit support for Covidhit MSMEs. o Overall cap of admissible guarantee under ECLGS is now expanded to 4.5 lakh crore. Addressing Delayed Payments by passing of the Factoring Regulation (Amendment) Act 2021 to help MSMEs by providing them added avenues for getting credit facility especially through Trade Receivables Discounting System (TReDS). o TReDS is an electronic platform where receivables of MSMEs drawn against buyers (large corporates PSUs Government departments) are financed through multiple financiers at competitive rates. o It will add to the MSME Samadhaan Portal which empowers micro and small entrepreneurs to directly register cases relating to delayed payments by Central Ministries DepartmentsCPSEsState Governments shine india monthly magazine buy.
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