Moves Taken to Help Small Businesses in India

Moves Taken to Help Small Businesses in India

Small businesses are a core to the Indian economy. A large count of business owners participate in the business marketplace through their small enterprises. According to a report, small businesses hold 90 per cent share in the country’s economy, therefore, holding a significance. During the pandemic, the emphasis of shoring up small businesses increased tremendously. 

In the last year, human lives were turned upside down amid the crisis-led lockdown. Demand and supply chains were inflated and consumers focused on fulfilling basic amenities only. Most commodities falling under basic amenities were sold by small businesses and with the lockdown, the market situation became chaotic. As a result, businesses shrank or ceased operations permanently, a steep increase in food items was witnessed and the Indian logistic sector strived to meet demands of people. 

Repercussions of the ongoing health crisis and lockdown gave important teachings to the people as well as the government. The government understood the intensity of the situation and took necessary actions to uphold small businesses. It continued helping small businesses because this section of enterprises are still grappling for sustenance in the market. 

Of late, the government has rolled a new set of measures or initiatives to support the MSME sector, especially small business owners. 

Collaborating with State Government 

Small Industries Development Bank of India (SIDBI) reportedly decided to strengthen the business ecosystem of Assam. According to a report by Economic Times, it participated in a special event held at the Administrative Staff College, Assam to reinforce the state co-operation. 

During the event the KK Dwivedi, Principal Secretary, Industries & Commerce, presented the expectations of the state on three major themes: startups, cluster development and livelihood and enterprise promotion.

"SIDBI has been laying thrust on kindling entrepreneurship through its Mission Swavalamaban and also by digitizing credit availability process such that end customers reap the benefit of lower rate of interest and transparent access. SIDBI has been dovetailing its promotion and development initiatives on soft side with hard infrastructure through its latest offerings such as cluster development fund. SIDBI looks forward to deepening its footprint in Assam by contributing to livelihood and micro enterprise value chain as also innovation and startup ecosystem,"Sivasubramanian Ramann, Chairman and Managing Director, SIDBI said in the official statement. 

Credit Accessibility for MSMEs 

RBI has lately launched account aggregators (AAs), thus, making credit easily accessible to MSMEs. According to a report by Financial Express, AAs are a new class of non-banking financial companies (NBFCs) that offers account aggregation services — retrieving or collecting information of its customer pertaining to their financial assets and consolidating, organizing, presenting it to the customer or any other person as per the instructions of the customer. 

With the newly launched services, the user does not have to physically share hard copies of documents from various entities or confidential login details of users’ documents or browse through different sites for information required by financial service providers. In addition, it will facilitate streamlining credit access for MSMEs. Quick data sharing will expand the range of financial services for better products and services can help MSMEs access credit conveniently  and trustworthy manner that eventually might help address the credit crunch faced by MSMEs currently.