Ease of doing business for MSMEs: Retailers’ body Retailers Association of India (RAI) on Thursday urged the government to extend all benefits available for registered MSMEs to retail traders as well in the country. In its recommendations for the union budget 2023-24, RAI said a special focus on the retail sector is important for the long-term revival of the economy and suggested that the budget must prioritize growth-oriented measures to stimulate demand and consumption through supportive policies, simplified regulations, skill development and simple goods and services tax (GST) norms.
“Benefits like subsidy on patent registration, tax exemption, protection against delayed payments, electricity bill concessions, reimbursement of ISO certification (cost), marketing and promotion assistance from the government, technology upgradation support to name a few are not available to traders,” Kumar Rajagopalan, Chief Executive Officer, RAI told FE Aspire.
Also read: FE Exclusive: Loans to retail, wholesale traders under CGTMSE to be treated at par with other segments
Importantly, in July 2021, the government had announced the inclusion of retail as well as wholesale trade under MSME the MSME definition revised in 2020 post Covid for the limited purpose of priority sector lending.
Moreover, in December 2022, the government’s credit guarantee scheme for micro and small enterprises (MSEs) under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) had brought retail and wholesale trade by micro and small enterprises at par with other segments or activities eligible for credit guarantee cover under the scheme.
With this, the credit limit for MSEs into retail and wholesale trade with guarantee cover was increased from Rs 1 crore to Rs 2 crore, according to a circular issued by CGTMSE to all member lending institutions (MLIs). Moreover, the extent of guarantee coverage and the rate of annual guarantee fee (AGF) were also brought at par with other activities.
Also read: Can’t blame e-commerce for slow growth of retail MSMEs as claimed by traders: IIFT report
“Over the period of time, we saw the behaviour of loan portfolio of retail and wholesale trade almost at par with other loans. Moreover, since retail loans have been growing rapidly as compared to the traditional loans, we thought it is high time to bring them at par with other loans,” Sandeep Varma, Chief Executive Officer, CGTMSE had told FE Aspire.
Bank credit to retail and wholesale trade in November had recorded a 16 per cent growth to Rs 7.33 lakh crore from Rs 6.32 lakh crore during November 2021, showed the latest sectoral deployment data from the Reserve Bank of India
Subscribe to Financial Express SME newsletter now: Your weekly dose of news, views, and updates from the world of micro, small, and medium enterprises