The MSME sector is at the budding stages in India right now. The entry
of high quality market participants has ushered in a great deal of
competition in the market and as a result of which many new MSMEs
require more budget allocation for their operations. In order to bridge
the gap of availing easy credit and marketing their products, the
Government of India has been very keen on introducing a vast number
of schemes and reforms for the welfare of the MSME sector. One of the
most notable of those is the Champions scheme on champions portal in FY23.
The steady growth of the use of Champions portal has facilitated ease of
onboarding of newer MSMEs into the sector. This has led to good PR
for the policies and more people are suddenly interested to find their
niche into this emerging sector.
The financial assistance that has been approved for innovation, design
and protection of intellectual property rights for the MSME sector is
approximately Rs.34 Crore. All design proposals, new patents by the
MSME sector in the present financial year comes under this sanction.
The MSME Idea Hackathon is also a major highlight event that was
introduced recently by the Ministry of MSME. Overall, 257 ideas under
MSME Idea Hackathon 2022, reimbursement of 1196 Trademarks, 186
Patents, 53 Designs and 11 Geographical indications (GIs) have been
under approval to avail the financial grant for FY23.
For more information: https://smeventure.com/msmes-embarking-on-the-journey-of-innovation-and-success/
During this year’s budget session, FM Nirmala Sitharaman in her speech
mentioned that she extended the Emergency Credit Line Guarantee
Scheme (ECLGS) to March 2023. Besides, the guaranteed cover has also
been extended by an additional Rs 50,000 crore. The total allotment
under the scheme would increase to Rs 5 lakh crore. In the previous
Budget, the finance minister unveiled ECLGS of Rs 20 lakh crore to help
the Covid-hit MSMEs. This has been a severe boost to regain back the
lost momentum of the MSME sector moving forward. As per the budget
session, there was an announcement related to the increase in
budgetary allocation for MSMEs from last year’s Rs 15,699.65 crore to
Rs 21,422 crore now (substantially up by 26.71%). This increase in the
budget will help shape the MSME landscape in the country.
The use of the Udyam Registration is also steadily on the rise due to the
ease of navigation for new MSMEs entering the space. This has led to
huge adoption rate amongst newer entrants into the MSME sector. The
MSME sector received overall support from the policymakers and as a
result this led to impetus in its growth.
Patent and trademark registrations by MSMEs, startups, and others,
saw around a four-fold increase during the FY16-FY21 period, according
to the details shared by Controller General of Patents, Designs and
Trademarks (CGPDT) with Commerce Minister Piyush Goyal in August
last year. While the number of patents granted jumped from 6,326 in
2015-16 to 28,391 in 2020-21, trademark registration increased from
65,045 in 2015-16 to 2,55,993 in 2020-21. Moreover, 4,505 copyrights
were granted in 2015-16 which increased to 16,402 during FY21.
The MSME Innovative component offers financial assistance up to Rs 15
lakh per idea and up to Rs 1 crore for relevant plant and machinery
under the incubation part of the scheme. The design part facilitates
expert advice on design problems for new product development and its
improvement through the financial support of up to Rs 40 lakh for
design projects and up to Rs 2.5 lakh for student projects.
Some important objectives of the CHAMPIONS scheme in FY23 :
1.) Grievance Redressal: resolve the problems of MSMEs including
those of finance, raw materials, labor, regulatory permissions etc
particularly in the Covid created difficult situation.
2.) Help in capturing new opportunities: including manufacturing of
medical equipments and accessories like PPEs, masks, etc and supply
them in National and International markets.
3.) To identify and encourage the leaders: i.e. the potential MSME
CHAMPIONS PORTAL who are able to withstand the current weather and can
become national and international champions.
Do watch: https://www.youtube.com/watch?v=PuzisdPv1Xo&t=8s
Around 95.21 per cent of total ECLGS (Emergency Credit Line
Guarantee Scheme) beneficiaries as of March 11 have been MSMEs.
The sharp fall in the number of beneficiaries in 2021-22 compared to
2020-21 could be due to three reasons, first, the emergency situation
would have vanished; second, obtaining the fund may be difficult; and
third, a considerable percentage (of promoters) would have got into
alternative professions on their own.
ECLGS has been applicable to existing credit borrowers constituted as
proprietorships, partnerships, registered companies, trusts and limited
liability partnerships (LLPs) and individual businesses apart from
MSMEs. The credit guarantee is provided by National Credit Guarantee
Trustee Company Limited (NCGTC), which operates the scheme, to
member lending institutions including banks and non-banking financial
companies with respect to the credit given to borrowers on their loan
as of February 29, 2020.
As of April 30, 2022, Rs 3.32 lakh crore loans were sanctioned, of which
Rs 2.54 lakh crore amount was disbursed, the Reserve Bank of India
(RBI) had said in its latest Financial Stability Report earlier last month.
According to the report, private banks have shown a greater appetite
than public banks in utilising different versions of ECLGSs. While private
banks disbursed Rs 95,700 crore to fresh borrowers and Rs 34,600 crore
to repeat borrowers, public banks disbursed Rs 79,800 crore to fresh
borrowers and Rs 18,300 crore to repeat borrowers. NBFCs had
disbursed Rs 20,800 crore to fresh borrowers and Rs 7,700 to repeat
borrowers.
The collective effort of the MSMEs and the continuation of financial
support from the policymakers enabled a holistic approach towards the
growth of the MSMEs. The use of technology has tremendously helped
in developing platforms like Udyam registration via online mode and
the MSME CHAMPIONS scheme and champion portal. The likelihood of normal people
participating in the MSME sector has increased many folds and this
paves the way for a brighter future for the businesses involved leading
to their greater impact on the economy.