2012-02-18 00:00:00 Starting a Business English https://d3hrajprm8dqcv.cloudfront.net/wp-content/uploads/2017/05/08195616/National-Emblem1.jpg SME Friendly Initiatives

SME Friendly Initiatives

2 min read

Here’s a round-up of some of the recent SMEs friendly initiatives that have been backed by the government. It is crucial for SMEs to capitalize on governmental policies and initiatives that support their goals. While the Government of India has consistently acknowledged the fact the Micro, Small and Medium Businesses are the prime contributors to the nation’s growth, SMEs often fail to keep track and avail of government initiatives. SM Jamkhandi, the Director of Micro, Small and Medium Development Institute (MSME-DI), Bangalore, expressed his concerns about the lack of awareness of SME-friendly Government schemes and initiatives in the sector. He stated that, “although the government was offering a slew of schemes and sops for SMEs, a majority didn’t utilize them due to lack of awareness and education about the schemes.” Jamkhandi also went on to add that the government has set the ball rolling by instructing all banks to focus more on SMEs. Here are some of the recent Government initiatives targeted at SMEs’ growth and development. SME verticals at banks The Reserve Bank wants to establish dedicated verticals at banks to help small and medium businesses to deal with financial matters. Banks that have been working with SMEs will start to provide consulting services on finance, cash-flow management, taxation, and related areas for a fee. SMEs can then turn to banks for more than just loans and associated services. Credit guarantee The Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE), founded in 2000, is a collateral-free credit scheme. This scheme supports both existing and start-up SMEs. To support the rapid expansion of SMEs in India, there are now talks of increasing the size and scale of the guarantee scheme by setting higher credit limits. Combined with defined mandates for banks to implement the scheme, the initiative will improve SME access to funds. Launch of SME Exchange The Bombay Stock Exchange (BSE) is set to launch the Small and Medium Enterprise (SME) Exchange by the end of March 2012. The Securities and Exchange Board of India (SEBI), the capital market regulator, has already given its clearance to the dedicated stock exchange, aimed at giving SMEs access to market financing. .The SME Exchange is slated to initially target a list of around 500 organizations. National Award Scheme This is a great way for SME owners to get recognized and up their organization’s rating. The ministry of Micro, Small and Medium Enterprises (MSME) annually presents National Awards to deserving entrepreneurs and enterprises under this scheme. In order to be eligible for this award, one has to have a permanent registration as an MSME. MSMEs that apply should have been in continuous operation for a minimum of four years. If you think your business meets these criteria and has successfully accomplished its vision, consider entering the MSME National Award Scheme. Tools Room and Training Centres The Central Government has initiated a scheme worth Rs.15 crores to setup Mini Tools Rooms and Training Centres to help out SMEs. This scheme will be routed through individual state governments. Jigs, cutting tools, gauges, fixture, and similar equipment will be produced under this scheme. The scheme also seeks to provide training in toll manufacturing and tool design for SMEs that specialise in skilled work, design and engineering. This apart, the scheme helps with generic business consultation and documentation.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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