Budget 2020 Expectations: 'Gifts' SMEs, MSMEs want from FM Nirmala Sitharaman on February 1

Budget 2020: Asking for steps that would ensure higher consumption, ease of doing business and rise in credit flow to the SMEs and MSMEs ecosystem, industry insiders have put forth their demands before Finance Minister Nirmala Sitharaman. Expectations are high that FM, when she stands to present her second Union Budget on 1st February 2020, will announce various sops for all concerned. SMEs and MSMEs have also raised a demand to address their woes in regard to GST filing.

Sudarshan Chari, Head – Business Banking at DBS Bank India said, "For the Budget 2020, boosting consumption, enhancing the ease of doing business and increasing credit flow to the SME ecosystem should be some of the top priorities. Measures such as rationalization of GST will provide an impetus to domestic trade and fuel the growth of the SME sector. We believe that democratizing access to timely and adequate credit will continue to be a key focus area. Initiatives such as the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) and more recently, the interest subvention for all GST registered MSMEs, have been encouraging steps in this direction." 

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Chari said that further extension in the subversion scheme and adopting a broad-based approach for the loan disbursement criteria under CGTMSE will bridge gaps in the current SME financing scenario and bring more companies into the fold of the formal economy."

Speaking on the Budget 2020 expectations of the MSMEs, Manish Lunia - Co-Founder of FlexiLoans.com said, "MSME sector has been the backbone of the Indian economy with over around 30-40 per cent contribution to GDP despite social, logistical and, resource-based challenges. The Indian businessman has battled the woes of Demonetization, GST implementation, Banking Crisis and Credit crunch, etc. in the past 5 years and pessimism around the system is under-represented, if at all. The Budget 2020 should make efforts to empower the growth of MSMEs by providing them access to required credit with the help of supporting financial institutions with encouragement on data, credit guarantee, and easy documentation for availing finance along with expanding prospects of business across Sectors." 

Linia said that incentivization on using digital adoption by MSMEs will also be a stronger requirement while easing compliance around the same.