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Micro, small and medium sized enterprises (MSMEs) in Central India are facing funding problems like easy and low interest rate loans and working capital from banks, feel industry associations from Madhya Pradesh.
“Despite advantages like proper power supply, peaceful labour force and stable government, central Indian SMEs do not undergo the required growth due to funding and other issues related to banks,” said Ashok Barjatya, president, Association of Industries Madhya Pradesh (AIMP).
Federation of Madhya Pradesh Chambers of Commerce and Industry (FMPCCI) and Association of Industries Madhya Pradesh (AIMP) are regularly raising issues like funding, loans, interest rates etc with banks and other funding bodies.
“SMEs get loans and working capital from banks at a higher interest rate compared with large enterprises. Also, their ratings are degraded on minor defaults and interest rates are increased,” said Ramesh Agrawal, president of Federation of Madhya Pradesh Chambers of Commerce and Industry.
We feel banks should also consider factors like loyalty and timely payments before taking any decision on SME ratings, added Agrawal.
Industry associations are also in favour of subsidies for SMEs as they give employment to large number of people compared with large enterprises.
“Subsidies are pro-revenue and not anti-revenue as they get returned to the government in some or the other form whenever industries make profit,” said Ashok Barjatya, president, AIMP.
These associations are also organising functions and seminars to raise these issues and educate industrialists from central Indian.
Recently, one such function was jointly organised by Federation of Madhya Pradesh Chambers of Commerce and Industry (FMPCCI) and Association of Industries Madhya Pradesh (AIMP) in Indore which was attended by many industrialists from central India, representatives of banks like Bank of Baroda, State Bank of India, SIDBI and insurance companies etc.
Banking representatives urged the industrialists not to show negative balance sheet as it may affect their rating and reputation.
Industrialists who attended the function also got tips on various bank and insurance related issues from the speakers.
