Credit and Finance for MSMEs: Despite 45 days of unlock 1.0, demand has hardly picked up as retailers witnessed “very minimal footfall” apart from facing lack of manpower and financial crunch.
Credit and Finance for MSMEs: Retail trade has suffered a loss of around Rs 15.5 lakh crore in the past 100 days due to Covid pandemic, trader’s body Confederation of All India Traders said on Sunday. Despite 45 days of unlock 1.0, the demand has hardly picked up as retailers witnessed “very minimal footfall” apart from facing lack of manpower and financial crunch. “Domestic trade in the Country is passing through its worst period in the current century which reflects that if immediate steps are not taken about 20% of the shops in India will have to close down their shutters,” CAIT’s national president BC Bhartia and secretary general Praveen Khandelwal said in a statement claiming that there has been no support policy from the Central or State government.
Around Rs 5 lakh crore of business loss has been estimated in April followed by around Rs 4.5 lakh crore in May, about Rs 4 lakh crore in June and approximately Rs 2.5 lakh crore in the 15 days of July, according to Bhartia and Khandelwal. “Having fear of Corona leading to avoidance of exposure, the local consumers are not visiting markets whereas purchasers who were procuring goods from neighbouring states or cities are not visiting due to Corona fear,” said Bhartia and Khandelwal. Traders are forced to shut shops around 5 pm every day and “as per inputs available from the traders across country, there is a footfall of only 10 per cent,” the two added in the statement.
Meanwhile, government’s flagship credit support scheme for MSMEs – Emergency Credit Line Guarantee Scheme continued to offer emergency loan to Covid-hit MSMEs. Rs 68,311.55 crore has already been disbursed as of July 15, 2020 to 17,98,336 MSME accounts. Public sector banks (PSB) have disbursed majority amount of Rs 41,819.19 crore to eligible MSMEs. Finance Minister Nirmala Sitharaman had announced the working capital support of 20 per cent of the outstanding credit for MSMEs as on February 29, 2020, in the form of term loans at a concessional interest rate.