MSMEs in Covai demand lower interest rates for credits

With days ahead of the Union Budget, in a memorandum to the Finance Minister, the Coimbatore and Tiruppur District Micro and Cottage Entrepreneurs Association (COTMA) said the micro units are the worst hit during the pandemic. They are struggling to repay the loans, and hence demanded credit at lower interest rates.

The Tamil Nadu Association of Cottage and Tiny Enterprises (TACT) asked loans to be provided at 5% interest for micro units. In a memorandum to the RBI, it said the banks and all financial institutions should give one year moratorium to the micro units for the repayment of loans. they also demanded that the banks should not levy the penal interest and those who levied should cancel such penal interest for micro units for the pandemic period. Further, the banks should extend loans to the units irrespective of their CIBIL score and the banks should not take action on the defaulters as the units are hit by the pandemic, they demanded. The COTMA said the GST for job working micro units should be reduced to 5 % from 12 %. Also, high raw material prices continue to hurt the tiny enterprises. Hence, the government should issue MSME cards on the lines of Kisan cards, which could facilitate the MSMEs to buy accessories and inputs using the card. The Central government should also establish a large-scale public sector enterprise in Coimbatore region, it mentioned.

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