Hoping Against Hope

Thousands of small businesses are on the brink, with the government rescue package falling short of their expectations

- Shwweta Punj

₹3,00,000 CRORE

COLLATERAL-FREE LOANS

Units with outstanding loans up to Rs 25 crore and turnover of Rs 100 crore are eligible. These four-year tenure loans have a moratorium on principal repayment of 12 months. The scheme can be availed until October 31, 2020

₹20,000 CRORE

SUBORDINATE DEBT

Promoters of MSMEs with outstanding loans declared ‘stressed’ or ‘NPA’ will receive bank loans they can infuse as fresh equity

₹50,000 CRORE

EQUITY INFUSION

Equity-based funding for MSMEs through a fund of funds, set up with a corpus of Rs 10,000 crore

COVID-19 has kicked business owners in the gut. Thousands of small businesses, employing millions, face the grim prospect of permanent closure. A survey by the All India Manufacturers’ Association found that more than a third of the self-employed and small and medium businesses did not see any hope of recovery and were on the verge of winding up. A national multi-institutional survey by the SKOCH Group, a private think-tank, and FISME (the Federation of Indian Small and Medium Enterprises) conducted towards the end of May, found that 62 per cent of surveyed MSMEs (micro, small and medium enterprises) would let go of employees, and 78 per cent would cut wages. Both surveys were conducted after the recent government interventions.

AJAY JONEJA, 53