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23% rise in MSME bad loans in first quarter

Updated: Sep 17, 2019 06:26:29am
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23% rise in MSME bad loans in first quarter

Ahmedabad, Sep 17 (KNN) Despite banks have eased credit flows for the Micro Small and Medium Enterprise (MSMEs) but still it seems that sector continues to be under stress.

According to the latest report by State Level Bankers’ Committee (SLBC), bad loans in this sector have jumped from Rs 7,290 in the first quarter of 2018-19 to Rs 8,974 crore in the same quarter of 2019-20, which indicates that Non Performing Assets (NPA’s) in the MSME sector showed a sharp 23% rise in just a year.

Bankers blame current economic slowdown due to which there is a 23% rise in NPAs.

‘’Due to the slowdown, the bad loans in the MSME sector have gone up. Apart from ceramic and brass parts manufacturers in Morbi and Jamnagar respectively, MSME units in most sectors are under severe stress which caused a slowdown,’’ said SLBC official, according to a media report.

‘’Enough economic opportunities are needed in terms of projects by government as well as entrepreneurship. These are the aresa where government intervention is needed,’’ the SLBC official further added.

Gujarat Chief Minister along with Deputy CM Nitin Patel, the Deputy Governor of Reserve Bank of India, PS Jaykumar and additional chief secretary, finance, Arvind Agrawal were present during the 162nd SLBC meeting which was held in Gandhinagar.  

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