What is Vivad Se Vishwas scheme for MSMEs? Check benefits

Oct 01, 2023 Girish Khurana

Ministry of Finance launched the scheme ‘Vivad se Vishwas I – Relief to MSMEs’ for providing relief to Micro, Small and Medium Enterprises (MSMEs)

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The scheme was announced in the Union Budget 2023-24 by Finance Minister Nirmala Sitharaman for MSMEs which were unable to fulfill their contracts during COVID 19 period

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The scheme will apply to all domestic contractual disputes where one of the parties is either the Government of India or an organisation working under its control

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The Ministry of Finance, through this scheme, decided to give following additional benefits to eligible MSMEs

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95% of the performance security forfeited shall be refunded

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95% of the Bid security shall be refunded

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95% of the Liquidated Damages (LD) deducted shall be refunded

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95% of the Risk Purchase amount realized shall be refunded

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In case any firm has been debarred only due to default in execution of such contracts, such debarment shall also be revoked, by issuing an appropriate order by the procuring entity

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No interest shall be paid on such refunded amount

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Under the scheme, the government has so far cleared grants of more than Rs 256 crore, to 10,000 MSMEs (Source: Finance Ministry)

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