Credit and Finance for MSMEs: The Modi government’s Standup India scheme, which facilitated bank loans in between Rs 10 lakh and Rs 1 crore to scheduled caste (SC) or scheduled tribe (ST) and girls entrepreneurs, has sanctioned 1,11,619 loan applications involving Rs 24,985.27 crore as of March 2, 2021, according to the information shared by the Minister of State for Finance and Corporate Affairs Anurag Singh Thakur in Rajya Sabha on Tuesday. The scheme was launched on April 5, 2016, by Prime Minister Narendra Modi to help at least one SC/ST and lady borrower per bank branch for setting up a greenfield enterprise in the manufacturing, services, or trading sector.
Pursuant to the announcement created in the Budget speech this year by Finance Minister Nirmala Sitharaman, the margin revenue requirement for loans below this scheme was lowered from up to 25 per cent to up to 15 per cent. Also, activities allied to agriculture had been incorporated in the scheme. The scheme has onboarded more than 300 lenders with more than 1.5 lakh branches connected to the scheme.
“The government has taken various steps towards effective implementation of the Scheme. These, inter alia, include provision for submission for online applications by potential borrowers through an online portal, handholding support, intensive publicity campaign, simplified loan application form, credit guarantee scheme, campaign for target group through dedicated weekly programmes etc.,” Thakur mentioned in his reply.
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As of March 2020, the states with the highest quantity of accounts and quantity sanctioned had been Andhra Pradesh in which Rs 1,284.11 crore was sanctioned across 5,313 accounts. Similarly, 6,292 entrepreneurs in Gujarat secured Rs 1,837.7 crore in loan, Uttar Pradesh saw 11,455 entrepreneurs raising Rs 2,317.89 crore, Maharashtra had 6,834 accounts and Rs 1,577.05 crore sanctioned in loan.
Meanwhile, bank credit deployed to micro and compact enterprises in December 2020 had elevated 6.6 per cent to Rs 11.31 lakh crore from Rs 10.61 lakh crore for the duration of the year-ago period. The December year-on-year (YoY) credit development to MSEs was also up from 6.1 per cent YoY development in November 2020, according to the information from the Reserve Bank of India (RBI). Banks had deployed Rs 11.22 lakh crore to MSEs in November down from Rs 11.25 lakh crore in October.