Odisha MSME Dept urges banks to consider easing norms for MSME loans

Bhubaneswar, Jan 18 (KNN) Drawing attention towards the master direction of RBI on lending to MSME sector, Odisha Secretary for Micro, Small and Medium Enterprises (MSME) department LN Gupta has urged banks to consider increasing the limit to dispense with the collateral requirement for loans up to Rs 25 lakh based on track record and financial position of the MSME units.

He was chairing the meeting of sub-committee of the State Level Bankers’ Committee on MSME and Skill Development.

He said the banks were further told to follow the guidelines of Centre and not to ask for collateral security for loans up to Rs 2 crore covered under Credit Guarantee Trust Fund for Micro and Small Enterprises (CGTMSE).

The sub-committee has asked the bankers not to ask for collateral security while extending loans up to Rs 10 lakh under Prime Minister Employment Generation Programme (PMEGP).

According to a media report, during the review, it was revealed that subsidy of Rs 38.89 crore has been disbursed to 1,709 MSME units under PMEGP during the current year up to January 15.

The sub-committee has advised the banks to expedite disbursement of assistance in respect of already sanctioned cases and decide the pending applications latest by February 15, 2018. Further banks were requested to advise each of their branches to consider sanction of at least three to five PMEGP cases with a view to boost achievement under programme, sources said.

The panel has asked the banks to sanction more loans under Kishore and Tarun category. Banks were further advised to pro-actively finance clusters, start-ups and ventures promoted by skilled youth. (With Inputs from a media report)