The government has taken a big decision for small and medium businessmen in the country. Now MSME sector workers will be able to get cheap and easy loans. In order to provide cheap and easy loans to small and medium industries (MSME), the Reserve Bank has advised banks to link MSME loans to external benchmarks.
The government gave this information in the Parliament. The government said that the interest rate of loans linked to external benchmark will be reset every three months, due to which the benefit of change in interest rates will be available quickly. Besides, old borrowers have also been given the option to migrate to the new system with mutual consent. This means that old businessmen will be able to easily switch to the new system and take advantage of it.
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Discount in quality control order
Apart from this, to ensure that domestic production is not affected, various exemptions and reliefs have been given to MSMEs in the Quality Control Order (QCO). Additional extension of six months has been given to micro enterprises and three months to small enterprises. The government said that relaxation has also been given in raw materials imported for export, limited imports for research and development (R&D) and clearance of old stock. Huge concessions are being given to micro, small and medium enterprises in BIS fees.
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Along with this, the government has implemented the Mutual Credit Guarantee Scheme for MSMEs, which will make it easier to take loans for purchasing machinery and equipment. At the same time, micro and small units will not have to give any collateral on loans up to Rs 10 lakh. The government says that these steps will provide financial relief to MSMEs and strengthen their business.