Finance and Banking sector reacts to Union Budget 2022-23; MSME credit lenders show appreciation

New Delhi, Feb 2 (KNN) The Finance and Banking sector has accepted the Union Budget with much enthusiasm and satisfaction calling it a growth oriented budget clearly aiming for economic recovery.

It has also received its support from Non-bank financial institution (NBFC) sector especially the ones catering MSMEs and small businesses across the country.

Here are some of the key reactions straight from the sector:

Rajkiran Rai G, MD and CEO, Union Bank of India: The union budget is a growth oriented budget, and it is set in context of recovering economy with good macro stability. The Finance Minister takes forward growth impetus through enhanced outlays on public capex, incentives for digital, start-ups, supporting MSMEs, and targeted welfare spending in 2022-23. The cumulative Government support through ECLGS rising to Rs 5 trillion till March 2023 is a welcome enabler for credit to vulnerable sectors of economy. Moreover, the absence of capital allocation for public sector banks reaffirms confidence in strength of banking sector in meeting the credit needs of economy.

Rajesh Sharma, Managing Director, Capri Global Capital Ltd: We welcome the growth-centric Budget aimed at securing India’s long-term economic interest. The union budget 2022-23 has shown a progressive and development-oriented focus for infrastructure and MSME. Extension of Emergency Credit Line Guarantee Scheme by another year and coverage increment of 50,000 crores will give the necessary impetus and act as a key enabler to empower the MSME businesses at the grassroots. The announced measure will have a domino effect on the sector as well as provide a cushion to create an engine of economic growth. The inter-linkage of various portals for MSMEs will bring the masses who require the necessary thrust and foster an environment where India becomes integral to global demand. We believe the government will accelerate the task to implement the measures efficiently and rapidly for desired outcomes. Additionally, the allocation of Rs 48, 000 crores for Pradhan Mantri Awas Yojana will fuel the vision of Housing for All and de-bottleneck issues surrounding the affordable housing segment. The announced measure will have a force multiplier for ancillary sectors to generate more opportunities.

Rahul Raj, Founder & CEO, FloBiz: It is gratifying to see a sustained push towards digitisation & promoting the Aatmanirbhar Bharat vision as we welcome the union budget. We believe the measures & initiatives announced for the upliftment of MSMEs will significantly help in boosting the economic activity impacted by the pandemic. The decision to revamp the Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE) scheme and infuse additional credit of Rs 2 lakh crore will also assist in business continuity, exploring new opportunities in manufacturing, and creating more employment avenues. In addition, the Emergency Credit Line Guarantee Scheme (ECLGS) extension up to March 2023 is a great push for the MSMEs, especially for enterprises that are not yet back to the pre-pandemic levels of business scale & are slowly moving towards their recovery. This Union Budget has also recognised startups as key drivers of growth and innovation in the country. The extension on the period of incorporation and providing tax incentives will provide impetus and inspire entrepreneurs to continue driving innovation to put the Indian economy strongly on a clear growth trajectory.”

Ajay Pareek, Chief Business Officer, Fullerton India Credit Company: The union budget clearly focused on economic recovery through increased capital expenditure for the country’s growth. The push towards self-reliance reveals the government’s steadfast intention to achieve the long-term goal of ‘Atmanirbhar Bharat’. The extension of the ECLGS scheme till March 2023, as well as the expansion of the guarantee cover by Rs 50,000 crore to Rs 5 lakh crore is a welcome sign for the NBFC sector and over 130 lakh MSMEs. The thrust to digitise India and the focus on the fintech segment will help enhance financial inclusion. The affordable housing segment also received a boost today, with the allocation of Rs 48,000 crore under the PMAY urban and rural schemes.

Ketan Doshi, Managing Director, PayPoint India: Presenting the budget for the financial year 2022-23, the finance minister mentioned that the Government’s aim for this year would be to expand the scope of digital banking further and take it to every citizen and make it more inclusive. Taking forward this agenda, 75 digital banking units are expected to be launched in 75 districts to incentivize digital payments adoption and bolster the payments infrastructure further. The thrust on the digital ecosystem and the technology adoption in rural areas would immensely benefit from the move. Further enabling financial inclusion is the move to connect 150,000 post offices in India to the core banking system, allowing people, especially in rural areas, to access their accounts online and transfer money within post office accounts and other banks. Additionally, the launch of Digital Rupee is a move that comes at a suitable time. It would create a seamless and cost-effective payment system and eliminate the spread and use of unregulated digital currencies. We expect the virtual currency to positively stimulate the economy and help promote further innovations in the digital and blockchain technology ecosystem.

(KNN Bureau)