Finance Minister Arun Jaitley on Thursday claimed that the Micro, Small and Medium Enterprises (MSMEs) are an engine of growth and employment.
Presenting this year's Union Budget, Jaitley announced Rs 3794 crore to MSMEs for credit support, innovation, and capital interest subsidy. Further, the amount is also expected to ease cash flow challenges.
"There has been mass formalization among MSMEs post demonetisation and the introduction of the Goods and Services Tax (GST), which is generating a large financial information database. This will be used for financing MSMEs. Online loan sanctioning is to be revamped, and the government will soon announce measures for NPA resolution for MSMEs," he said.
Jaitley further noted that FinTech firms and NBFCs could drive the growth of MSMEs in India, and hence must undertake steps to increase activity.
Jaitley also said the government targets Rs 3 lakh crore for lending under the MUDRA scheme in 2018 -19, and proposed to bring public sector banks under the Trade Receivables Discounting System (TReDS) and link it with the GST Network (GSTN).
In terms of angel investors and venture capital, Jaitley noted that schemes like Startup India will generate robust investment regime. Additionally, the Finance Ministry, he said, is monitoring policies to take additional measures for them to grow.