Lok Sabha Question No. 56 (STARRED), answered on 2021-02-04
Subject: Loans to MSMEs
Ministry: MICRO,SMALL AND MEDIUM ENTERPRISES
Asked by: Komati Reddy Venkat Reddy, K. Muraleedharan

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA STARRED QUESTION NO. 56 TO BE ANSWERED ON: 04.02.2021

## LOANS TO MSMEs

## *56.               SHRI KOMATI REDDY VENKAT REDDY:

Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:

- (a) whether  there  has  been  some  slowdown  in  loans  sanctioned  to  struggling    businesses  and Micro, Small and Medium Enterprises (MSMEs) in the pre and post Covid-19 period;
- (b) if so,  the comparative details thereof and the reasons therefor;
- (c) the corrective steps being taken/results yielded, loan-wise, during  the last three years and the current year;
- (d) the relief measures under the loan moratorium scheme extended to MSMEs in the country; and
- (e) the details of demands raised by MSMEs and met by Government so far, State-wise?

## ANSWER

## MINISTER OF MICRO, SMALL AND MEDIUM ENTERPRISES (SHRI NITIN GADKARI)

- (a) to (e): A statement is laid on the Table of the House.

## STATEMENT  REFERRED  TO  IN  REPLY  TO  PART  (a)  to  (e)  OF  THE  LOK  SABHA STARRED QUESTION No. *56 FOR ANSWER ON 04.02.2021.

- (a) & (b): The statement of Sector wise deployment of Gross Bank Credit released by Reserve Bank of India indicates that as on 18 th December, 2020, there is marginal decline of 1.5 percent in the credit extended to Micro and Small Sector as compared to 27 th March, 2020.  The details of credit extended to this sector since December 2018 is given in the table below:
- (c): The steps  taken  by  the  Government  to  increase  availability  of  credit  to  the  MSME  sector inter-alia include Rs 20,000 crore Subordinate Debt for MSMEs under Credit Guarantee Scheme for Subordinate Debt (CGSSD), Rs. 3 lakh crores collateral free automatic loans for business, including MSMEs  under  Emergency  Credit  Line  Guarantee  Scheme  (ECLGS),    Rs.  30,000  crore  Special Liquidity Scheme for NBFC/HFC/MFI,  Pradhan Mantri SvaNIDHI Scheme for collateral free loans to  Street  Vendors  etc.    As  on  date  34  Banks  are  registered  under  CGSSD.  As  informed  by Department of Financial Services, as on 25.01.2021, guarantees to the tune of around Rs 2,01,364 crore has been issued under ECLGS.

| Credit to Micro &Small Sector (Manufacturing &Service Sector)   | Credit to Micro &Small Sector (Manufacturing &Service Sector)   | Credit to Micro &Small Sector (Manufacturing &Service Sector)   | Credit to Micro &Small Sector (Manufacturing &Service Sector)   | Credit to Micro &Small Sector (Manufacturing &Service Sector)   | Credit to Micro &Small Sector (Manufacturing &Service Sector)   | Credit to Micro &Small Sector (Manufacturing &Service Sector)   | Credit to Micro &Small Sector (Manufacturing &Service Sector)   | Credit to Micro &Small Sector (Manufacturing &Service Sector)   |
|-----------------------------------------------------------------|-----------------------------------------------------------------|-----------------------------------------------------------------|-----------------------------------------------------------------|-----------------------------------------------------------------|-----------------------------------------------------------------|-----------------------------------------------------------------|-----------------------------------------------------------------|-----------------------------------------------------------------|
| Dec.21, 2018                                                    | Mar.29, 2019                                                    | Dec.20, 2019                                                    | Mar.27, 2020                                                    | Dec.18, 2020                                                    | Variation (Year-on-Year) % Dec.20, 2019 / Dec.21, 2018          | in Dec.18, 2020 / Dec.20, 2019                                  | Variation Dec.20, 2019 / Mar.29, 2019                           | (Financial Year) in% Dec.18, 2020 / Mar.27, 2020                |
| 1004744                                                         | 1067175                                                         | 1061953                                                         | 1149394                                                         | 1131858                                                         | 5.7                                                             | 6.6                                                             | -0.5                                                            | -1.5                                                            |
| Source- RBI                                                     | Source- RBI                                                     | Source- RBI                                                     | Source- RBI                                                     | Source- RBI                                                     | Source- RBI                                                     | Source- RBI                                                     | Source- RBI                                                     | Source- RBI                                                     |

In addition to this, Ministry of MSME also provides guarantees in respect of credit facilities extended by Lending Institutions to the borrowers in Micro and Small Enterprises (MSEs) sector. The performance of the scheme during last three years and the current financial year is given in the table below:

| Financial Year               | No. of Guarantee   | Amount of Guarantee (Rs. in Cr.)   |
|------------------------------|--------------------|------------------------------------|
| 2017-18                      | 263195             | 19065.90                           |
| 2018-19                      | 435520             | 30168.57                           |
| 2019-20                      | 846650             | 45851.22                           |
| 2020-21 (upto on 31.12.2020) | 542802             | 25512.71                           |
| Source- CGTMSE               | Source- CGTMSE     | Source- CGTMSE                     |

- (d): Reserve Bank of India (RBI), vide circulars dated 27.3.2020 and 23.5.2020 on COVID-19 Regulatory  Package,  permitted  all  lending  institutions  to  grant  a  moratorium  of  six  months  on payment of all  instalments  (including  equated  monthly  instalments,  or  EMIs)  falling  due  between 1.3.2020 and 31.8.2020, in respect of all term loans outstanding as on 1.3.2020.
- (e): Ministry  of  MSME  receives  representations  from  MSME  Associations  on  issues  such  as availability of credit, capital subsidy etc. Such representations are considered on the basis of merit and administrative feasibility.

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