Proprietor
Prima Steels
Though planning at higher levels is done for the betterment of people in general, many a times it fails to deliver to the class it is supposed to affect the most.
The reduction in interest rates is welcome but there are some limitations. First, the time required to sanction loans and advances is very long. This has the potential to dissuade the small-scale industries as most of their monetary requirements are short-term in nature.
Secondly, the documentary requirements continue to be a tedious norm. The inability of the small fry to provide the papers on time forces them to accept higher interest rates from other lending financial institutions than what they would have otherwise got. More simple and easy procedures for small loans should replace the current laborious ones.
Thirdly, the processing fees are very high and this discourages the small-scale companies. For our ilk, paying high processing fees is just not a feasible proposition. A nominal processing fees should be the norm, instead.
Fourthly, very low/attractive interest rates are offered only to large organisations where the fund requirements are very high and the interest earned by the banks from such transactions is also substantial.
The small units are not able to negotiate for low interest rates, but have to settle for the prevailing rates varying from 11 per cent to 13 per cent. This puts substantial strain on the wherewithal of players.
Fifthly, small-scale industries are waiting for the domestic lending rates to match the international tariff card, where the range is between 5 and 6 per cent.
Witowh these, the sector can plan expansions and developments with comparatively less burden on their minds.
