New Delhi, 28 June (KNN) The government has asked all the public sector banks (PSBs) to resolve the problems which are being faced by the micro, small and medium enterprises (MSMEs) and submit weekly reports regarding it to give further boost to MSME businesses.

“It is therefore, requested that a CGM/GM (chief general manager/general manager) level officer may be specifically designated to do an in-depth analysis of the progress made and issues in availability of credit, still being faced by the MSMEs," the finance ministry said in a statement.

MSME sector has always been one of the key focus areas of Prime Minister Narendra Modi-led government and has been taking steps to iron out issues the sector is grappling with. MSME sector plays a crucial towards employment generation as well as exports, thereby propelling economic growth.

Under the new reporting mechanism, the banks will have to provide details of the MSMEs that have taken loans from the banks, non-performing assets (NPAs), the accounts involving restructuring and resolution as per Reserve Bank of India (RBI) circular dated January 1, 2019. The banks will also have to give details such as the new firms covered by the campaign and those which are yet to be covered.

Also, banks have been asked to submit a weekly report on monthly basis to the finance ministry.

Proforma for submitting Weekly Reports to Department of Financial Services (DFS), Ministry of Finance is being sent separately to these PSBs. The campaign will be supervised by ED in-charge of MSME Financing.

The government has also asked the bank general managers to get details of MSMEs who are availing loans from the banks, details of accounts that have turned into bad loans. They have also been asked get details of accounts where resolution has been done, as per the banking regulator’s January 1, 2019 circular.

“The Heads of all PSBs have been also asked that all sincere efforts should be made so that during the process of formalization, the MSMEs may not suffer in want of credit which should be available to them as per the extant guidelines," the ministry said.

The MSME sector has been a focus of the Modi government as it plays a crucial role in promoting economic growth.

MSMEs form an important component of the Indian Economy and contribute significantly to the country’s GDP, exports, industrial output, employment generation etc.  During the past few years, the sector is facing constraints on several fronts.