Government cuts target for Mudra loans in fiscal 22 and eliminates new public bank merger proposal



The government has set a loan disbursement target under Prime Minister Mudra Yojana (PMMY) of Rs 3 trillion for the current fiscal year, compared with sanctions of Rs 3.21 trillion in fiscal 21. Experts attribute the lower target to an increase in allocations under the credit guarantee scheme for small businesses.

Of the 3.21 trillion rupees of loans authorized under the Pradhan Mantri Mudra Yojana (PMMY) last fiscal year, 3.12 trillion rupees were disbursed to entrepreneurs, according to official figures. In fiscal 2019-20, this figure was even higher, with total authorized loans of Rs 3.37 trillion, of which Rs 3.29 trillion were disbursed.

Under PMMY, banks and non-bank finance companies provide business loans of up to 10 lakhs to small business units, including new ventures in sectors such as manufacturing, trade, services and agriculture-related activities. The central government sets targets annually for authorizing loans under the scheme. In the 22nd fiscal year, 13 crores authorized the issuance of loans in the amount of 3,804 crores. (OVO) as of June 25.

According to Madan Sabnavis, chief economist at ICRA, loans are wise to small businesses, which are part of the bank’s priority lending sector. Last year, government intervention through the Rs 3 trillion ECLGS scheme boosted loan payments, Sabnavis said.

“This year the mudra target was set at Rs 3 trillion, down from last year, but this year the ECLGS guarantees have been increased by an additional Rs 1.5 trillion. Therefore, the target is not really low as it comes with less government support, ”Sabnavis said.

According to SIDBI – TransUnion CIBIL MSME Pulse Report, MSMEs disbursed Rs 9.5 trillion in loans in fiscal 21, significantly higher than in fiscal 20, when Rs 6.8 trillion were disbursed in loans. The report says government interventions such as the ECLGS scheme have been a major contributor to this significant growth in MSME lending.

The government also informed parliament that Rs 167 crores was authorized under the Stand Up India scheme for the current fiscal year as of 28 June. The Stand Up India Scheme provides loans ranging from Rs 10 lakh to Rs 1 crore for the creation of new businesses in the manufacturing trade or services sector and agricultural-related activities. In the 2020-21 fiscal year, 12 PSBs under this scheme imposed sanctions of about Rs 2,155, which is about 38% less than the amount imposed by such banks in the previous year.

State Finance Minister Pankaj Chaudhary, responding to a separate request from Lok Sabha, said loans of Rs 3,918 crore were guaranteed to the hospitality, sports, leisure, travel and tourism industry under the Emergency Credit Line Scheme (ECLGS). as of 2 July 2021. The loan guarantee was provided after the ECLGS scheme was extended to the sectors affected by Covid-19 in March 2021, which included the provision of a loan of up to 40 percent of total loan debt across all lenders as of February 29. , 2020 for a period of 6 years, including a two-year moratorium.

No offer to merge PSB

The government is not considering any new proposals to combine more MoS Finance Bhagwat Karad said.

The government has merged Vijaya Bank and Dena Bank into Bank of Baroda since April 1, 2019, and Oriental Bank of Commerce and United Bank of India into Punjab National Bank, Andhra Bank and Corporation Bank into Union Bank of India, Syndicate Bank into Canara Bank. and Allahabad Bank at Indian Bank from April 1, 2020.

There is no official proposal from Cairn to resolve the dispute

The center has not received any formal proposals from Cairn Energy to resolve the tax dispute in accordance with the country’s legislation, Chaudhary’s Justice Department told MPs.

Chaudhary said a French court ordered the freezing of certain Indian government properties in the Cairn Energy case. The Permanent Court of Arbitration in The Hague ruled in favor of Cairn Energy Plc on 21 December 2020. He asked India to pay Cairne $ 1.2 billion in compensation plus interest and $ 22.38 million in arbitration and litigation costs.

Dear reader,

Business Standard has always made every effort to provide up-to-date information and commentary on events that interest you and have broader political and economic implications for the country and the world. Your support and constant feedback on how to improve our offerings have only strengthened our determination and commitment to these ideals. Even during these challenging Covid-19 times, we continue to strive to keep you updated and updated with credible news, authoritative opinions and insightful commentary on topical issues.
However, we have a request.

As we tackle the economic fallout from the pandemic, we need your support even more so that we can continue to offer you better content. Our subscription model has generated an encouraging response from many of you who have subscribed to our online content. An additional subscription to our online content can only help us achieve our goals – to offer you even better and more relevant content. We believe in free, fair and trustworthy journalism. Your support in the form of additional subscriptions can help us practice the journalism we are committed to.

Support quality journalism and subscribe to Business Standard

Digital editor


Source link