Govt ‘reminds’ corporates not filing half-yearly returns for MSME dues, yet to join TReDS platform

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October 19, 2020 8:19 PM

Credit and Finance for MSMEs: The government had launched the delayed payment monitoring portal MSME Samadhaan in October 2017 for ease of filing an application for due payments and tracking them.

The CAG found that income-tax department’s inadequate handling of search and seizure cases had a monetary impact of Rs 3,729 crore in the 1,291 cases that were audited.CPSEs and other companies with turnover of over Rs 500 crore have been mandated to join the TReDS platform.

Credit and Finance for MSMEs: MSME Ministry on Monday “reminding” corporates of timely MSME payments said that in many cases, corporates are not filing half-yearly returns about payment due to MSMEs. “Ministry has requested the corporates for their attention and needful action on this also,” the ministry said in a statement. It further asked corporates to get onboard bill discounting platform Trade Receivables Discounting System (TReDS) to help solve the cash flow crisis for MSMEs in the absence of clearance of dues. “Many companies are yet to join it or transact on it. Corporates have been requested to check whether their group/company has joined the TReDS platform and is doing transactions,” the ministry added.

Central Public Sector Enterprises (CPSEs) and other companies with turnover of over Rs 500 crore have been mandated to join the platform as buyers while MSMEs participate as sellers and banks, NBFCs and other financial institutions permitted by the Reserve Bank of India (RBI) participate as financiers. The government had launched the delayed payment monitoring portal MSME Samadhaan in October 2017 for ease of filing an application for due payments and tracking them. Micro and Small Enterprise Facilitation Council of the respective state wherein the application has been filed issues directions to the MSME buyers for payment of the amount along with interest as per the provisions under the MSMED Act 2006.

Also read: MSMEs’ long term recovery likely ahead but subdued demand, lower disposable income among key issues

Urging corporates to further clear dues, the ministry added that it has now written to over 2,800 corporates, after 500 such businesses last month, to settle payments in October itself. In the past five months, maximum payments of Rs 3,725.60 crore to MSMEs were cleared in September. “Not only that, in that timeframe, even the procurement and transaction appears to be maximum in the month of September,” the ministry added.

Over Rs 13,400 crore in dues were cleared by CPSEs in the past five months. The amount of Rs 989.10 crore pending at the end of September was also the highest among the five months. “If the cash flows of MSMEs improve, they can make use of the festival season when there is an opportunity to earn by supplying goods and services. In fact, some of the MSMEs look for such a period for their sustenance of the whole year.”

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