MSME delayed payments: Late clearance of payments to MSMEs by their government buyers including central ministries, departments, public sector units, and others against goods and services provided has been a major growth bottleneck of small businesses. While multiple measures have been undertaken by the government to address this issue, a large number of grievances have not been disposed so far.
According to the data from the Samadhaan portal, the number of applications or complaints filed by micro and small enterprises (MSEs) against delay in their payments pending with their buyers hit the 1.56 lakh mark, of which 30,527 or 19.5 per cent were disposed, as of Thursday. Rs 37,322 crore was involved in total applications filed since the launch of the portal on October 30, 2017, while the disposed cases involved Rs 5,328 crore.
Here is the list of measures taken by the government so far to prevent delay in payments to MSEs and support in receiving timely payments, according to a written response to a question by Bhanu Pratap Singh Verma in the Lok Sabha on Thursday:
- Under the provisions of the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, Micro & Small Enterprises Facilitation Councils set up in the States/UTs to deal with the cases of delayed payments of MSEs.
- Launched Samadhaan portal for filing grievances and for monitoring the outstanding dues to the MSEs from the buyers of goods and services on October 30, 2017.
- Requested states/UTs to set up more number of facilitation councils for quicker disposal of cases related to delayed payments. So far 152 MSEFCs have been set up with more than one MSEFC set up in states like Delhi, Jammu & Kashmir, Karnataka, Kerala, Maharashtra, Punjab, Rajasthan, Tamil Nadu, Telangana, Uttar Pradesh and West Bengal.
- Created a special sub-portal within Samadhaan Portal in June 2020 after the AatmaNirbhar Bharat announcements, for reporting the dues and monthly payments by central ministries/department/public sector enterprises to MSMEs.
- Instructed CPSEs and all companies with a turnover of Rs 500 crore or more to get themselves on-boarded on the Trade Receivables Discounting System, an electronic platform for facilitating the discounting of trade receivables of MSMEs through multiple financiers.
- Companies which get supplies of goods or services from MSEs and whose payment to MSEs exceeds 45 days from the date of acceptance or the date of deemed acceptance of the goods or services also need to submit a half-yearly return to the Ministry of Corporate Affairs stating the amount of payments due and the reasons of the delay.
- Budget 2023 allowed deduction under Section 43B of the Income Tax Act for expenditure incurred on payments only when payment is actually made to MSMEs.