Chennai: Consortium of Indian Associations (CIA), while welcoming the recent announcements by RBI Governor Shaktikanta Das on restructuring of advances for viable MSMEs, has however said, “though on the face of it , looks a timely right decision, but on seeing the directive from RBI, it appears that it may not serve the real purpose of either supporting viable MSMEs or avoidance of NPA increase in banks.”
In its request to Finance Minister Nirmala Sitharaman and RBI Governor, CIA said, “since the entire economy is affected all existing loans shall be restructured unless the borrower does not want it. This will help the entrepreneurs to spend more money in activities which will improve the economy.”
The industry body added: “Interest is the biggest burden , the government should provide at least 50 per cent interest subsidy. The restructuring formalities should be simple through an arrangement letter and not by lengthy process which involves additional costs and time. If there are any outstandingās receivable in the books of the Micro and small enterprises, the same shall be refinanced by the banks and the interest towards the same shall be collected from the party who has to pay the enterprises. If the other party fails to accept this condition, it shall be penalised”.