Guwahati: The National Democratic Alliance (NDA) has completed 100 days in office, it has to confront the headwinds of the financial and macro-economic uncertainties. On one hand, Non-Banking Finance Companies (NBFCs) are facing serious liquidity crunch after the collapse of Infrastructure Leasing & Financial Services Limited (IL&FS), and on the other hand, the health of public sector banks was still a major concern.
Speaking to ETV Bharat, Vinod Lohia, GST Consultant and a Businessman, has said that interest rates under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) are high which is hampering businesses in the sector.
"The slab has risen from 0.75% to 1.8%. The rates can further rise to 2.7%. I have surrendered my rupees 25 Lakh loan as it turned out to be non-cost effective," Vonod Lohia said.
"If people take loans at this rate, the question remains whether they could repay the loans on time," he added.
Further, taking about the economic condition, Lohia said that employment rates are falling, GDP touched 5%, Self-employment opportunities are low.
He also said that lack of proper implementation of Government support schemes and subsidies are hurting the sector
CGTMSE scheme is aimed at providing bank loans without collateral and third party guarantees. According to him, the interest rates are currently high which is hampering the credit flow into the MSME sector.
He further stated that education sector is going to generate Non-Performing Asset (NPA) in near future as employment opportunities are falling.
Besides, a report by Nomura Research Institute (NRI Consulting & Solutions) on the country's micro, small and medium enterprises (MSMEs) said dedicated focus on developing MSMEs in select segments can create additional 75 lakh to 1 crore employment opportunities in the next 4-5 years through partial substitution of imports.
Read: Indian MSMEs can create 1 crore jobs in 4-5 years: Report
