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Nearly 72% of financial transactions of PSBs done through digital channels, Share of financial transactions undertaken through home and mobile channels increased from 29% in FY2018-19 to 76% in FY2020-21

Posted on 20th Jul 2021 by Business So Simple in Financial Prudence

The Government has taken a number of steps to facilitate digital banking, doorstep banking services and digital lending platforms. This was stated by Minister of State for Finance Dr Bhagwat Kisanrao Karad in a written reply to a question in the Lok Sabha today.

Giving more details, the Minister stated that these services include, inter-alia, the following:

Initiation of digital lending has been made contactless through PSBloansin59minutes.com, using triangulation of credit bureau, income-tax and goods and services tax (GST) data, to provide online in principle approval for MSME loans.
Online bill discounting for MSMEs has been enabled on a competitive basis through Public Sector Banks (PSBs) onboarding onto the Trade Receivables Discounting System (TReDS) platform and the proportion of online discounted bills has grown rapidly.
Government’s ‘Jeevan Pramaan’ initiative for pensioners has enabled senior citizen pensioners the facility to update their annual life certificate online.
Under the Government-initiated PSB Reforms Agenda,—

Enhanced access to Mobile and Internet banking has been enabled through an increase in the average number of services offered (43), customer-friendly features (135) and regional language customer-interface (8);
End-to-end automated digital lending has been introduced in larger PSBs for unsecured personal loans (in five PSBs), loans to micro-enterprises (“Shishu Mudra”, in five PSBs) and renewals of loans to micro, small and medium enterprises (in three PSBs);
Digital retail loan request initiation through digital channels has been enabled in all the seven large PSBs, with retail disbursements from loan requests so initiated in the financial year (FY) 2020-21 amounting to Rs. 40,819 crore;
Customer-need-driven, analytics-based credit offers have been given an impetus, resulting in Rs. 49,777 crore of fresh retail loan disbursements by the seven larger PSBs in the financial year (FY) 2020-21.
As a result, nearly 72% of financial transactions of PSBs are now done through digital channels, with doubling of customers active on digital channels from 3.4 crore in FY2019-20 to 7.6 crore in FY2020-21, and the share of financial transactions undertaken through home and mobile channels has increased from 29% in FY2018-19 to 76% in FY2020-21.
PSB Alliance, an initiative of all PSBs and Indian Banks’ Association, has launched doorstep banking services for all customers, including senior citizens, through call centre (1800-121-3721 and 1800-103-7188), web portal (https://psbdsb.in/ and https://doorstepbanks.com/) mobile app (Google Play Store). At present 13 services are being offered in 100 cities across the country, which include cash withdrawal or deposit, pick-up of cheque or demand draft or pay order etc., pick-up of cheque-book requisition slip, pick-up of income-tax forms no. 15G/15H, pick-up of income-tax/GST challan, and delivery of tax deduction at source (TDS) and Form-16 certificates for income-tax purposes.

The Minister further stated that there is no proposal under consideration of the Government for setting up of a Digital Banking Infrastructure Corporation (DBIC). As per inputs from banks, some PSBs have held discussions to set up a corporation to create a common digital infrastructure platform as a joint initiative of the banks, with a view to enable enhanced access to consumers and businesses for credit offerings.

Ministry of Finance Press release dated 19th July 2021

Financial assistance for developing COVID-19 vaccine

Posted on 20th Jul 2021 by Business So Simple in Public Affairs

Ministry of Finance

Financial assistance for developing COVID-19 vaccine

Posted Date:- Jul 19, 2021

The Government has provided financial support to public research institutes and industry for COVID-19 Vaccine Development by the way of the Department of Biotechnology (DBT), Ministry of Science & Technology, through its Public Sector Undertaking, the Biotechnology Industry Research Assistance Council (BIRAC). This was stated by Minister of State for Finance Shri Pankaj Chaudhary in a written reply to a question in the Lok Sabha today.

The Minister stated that financial support was provided to nearly nine (09) private industries for the development of vaccines for COVID-19, whereby an amount of Rs. 489 crore has been allocated and an amount of Rs. 148 crore has been disbursed.

The Government decided that all citizens are entitled to free vaccination, the Minister stated.

The Minister stated that the Union Budget 2021-22 provided an Outlay of Rs 35,000 crore been towards COVID-19 vaccination. Apart from this, if required, the Government has also committed to provide additional funds for this as announced in para number 38 of the Budget Speech of Finance Minister Smt. Nirmala Sitharaman for the financial year 2021-22.

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Central transfers of funds for development of states

Posted on 20th Jul 2021 by Business So Simple in Public Affairs

Ministry of Finance

Central transfers of funds for development of states

Posted Date:- Jul 19, 2021

The Union Government provides funds to the State Governments under the Centrally Sponsored Schemes (CSS), Central Sector Schemes (CS), Finance Commission grants (FC grants) and Other Grants /Loans/Transfers as per the guidelines of the respective Scheme within the availability of Gross Budgetary Support with the Union Government. This was stated by Minister of State for Finance Shri Pankaj Chaudhary in a written reply to a question in the Lok Sabha today.

The Minister gave details of central transfers to States as per the Union Budget 2020-21(RE) and 2021-22 (BE) as under:-

(Rs in crore)

S. No.

Nature of Central Transfers to States

2020-21 (RE)

2021-22 (BE)

Total Transfers excluding Tax Devolution

713014.40

674253.42

Of which

Centrally Sponsored Schemes

315238.00

318857.20

Central Sector Schemes

42374.08

43016.21

Finance Commission Transfers

182352.43

220843.00

The concerned State Governments and Central Ministries/Departments review and monitor implementation of the schemes as per the scheme/programme specific guidelines to ensure effective utilization of funds including expenditure incurred, the Minister said.

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Tax exemption to ameliorate stress due to COVID-19

Posted on 20th Jul 2021 by Business So Simple in Income Tax

The Government has decided to provide income tax exemption to the amount received by a taxpayer for medical treatment from an employer or from any person for treatment of COVID-19 during the financial year 2019-20 and subsequent years. This was stated by Minister of State for Finance Shri Pankaj Chaudhary in a written reply to a question in the Lok Sabha today.

The Minister stated that Income-tax exemption shall be provided to the amount received by a taxpayer for medical treatment from an employer or from any person for treatment of COVID-19 during financial year 2019-20 and subsequent years.

The Minister further stated that the aim of this exemption is to provide relief to taxpayers who suffered on account of COVID-19 and had to incur sum for medical treatment of COVID-19 after taking help from employer or any person. It is the stated policy of the Government to discourage cash transactions and move towards less cash economy. Hence, there is no proposal to increase the limit of cash transactions permissible under various provisions of the Income-tax Act, 1961, the Minister stated.

Giving more details, the Minister said that in order to provide relief to the family members of taxpayers who have lost their lives due to COVID-19, the Government has decided that income-tax exemption shall be provided to ex-gratia payment received by family members of a person from the employer of such person or from other person on the death of the person on account of COVID-19 during FY 2019-20 and subsequent years.

The exemption shall be allowed without any limit for the amount received from the employer and the exemption shall be limited to Rs. 10 lakh in aggregate for the amount received from any other persons, the Minister stated.

The Minister further said that the Government has extended various key tax compliance deadlines due to impact of COVID-19 pandemic. The detail of these extended timelines is provided in the Annexure.

Ministry of Finance Press release dated 19 July 2021****

Investment for Procurement of Indigenously Manufactured Defence Equipment

Posted on 19th Jul 2021 by Business So Simple in Entrepreneurship

A In line with Government of India’s initiative of ‘Atmanirbhar Bharat’, it has been decided to earmark an amount of Rs 71,438.36 crore for domestic capital procurement out of the total allocation of Rs 1,11,463.21 crore for Capital Acquisition.

Capital procurement of defence equipment are undertaken from various domestic as well as foreign vendors, based on threat perception, operational challenges and technological changes and to keep the Armed Forces in a state of readiness. During last three financial years i.e. 2018-19 to 2020-21, 102 contracts have been signed with Indian vendors for capital procurement of defence equipment such as aircrafts, missiles, tanks, bullet proof jackets, guns, navy vessels, radars, networks etc.

In order to provide impetus to self-reliance in defence manufacturing as part of ‘Atmanirbhar Bharat’ initiative, two Positive Indigenization Lists have been promulgated. The first Positive Indigenization List was promulgated in August 2020, which included 101 items, and second list was promulgated in May 2021, which included 108 items. The lists intend to implement the ban in a staggered manner up to December 2025. The aim behind promulgation of the lists is to apprise the Indian Defence Industry about the anticipated requirements of the armed forces, so that they are better prepared to realize the goal of indigenization. It provides a great opportunity for the Indian Defence Industry to manufacture the items in the list by using their own design and development capabilities or adopting those developed by the Defence Research & Development Organisation (DRDO), to meet the requirements of the armed forces in the coming years.

This information was given by Raksha Rajya Mantri Shri Ajay Bhatt in a written reply to Shri Sambhaji Chhatrapati in Rajya Sabha today.

Government is Encouraging Setting up of Ethanol Plants

Posted on 19th Jul 2021 by Business So Simple in Entrepreneurship

Ministry of Petroleum & Natural Gas posted Date:- Jul 19, 2021

The entrepreneurs/project proponents are free to set up ethanol plants in any part of the country without seeking any formal approval from the Government of India. However, various statutory clearances from States/ Ministry of Environment Forest and Climate Change (MoEF&CC)/State Pollution Control Boards (SPCBs), etc. are required to be obtained during the course of setting up of the ethanol plant. Besides, DFPD is implementing scheme for extending interest subvention @ 6% p.a. or 50% of the interest charged by the banks whichever is lower, for 5 years including 1 year moratorium period.

The Central Government does not set up ethanol plants on its own in any part of the country. Central Government is however encouraging setting up of Ethanol Plants.

This information was given by the Minister of State for Petroleum and Natural Gas Shri Rameswar Teli in a written reply in the Lok Sabha today.

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Disbursal of Loans to Msmes Under ECLGS

Posted on 19th Jul 2021 by Business So Simple in MSME

Ministry of Micro,Small & Medium Enterprises posted Date:- Jul 19, 2021

Emergency Credit Line Guarantee Scheme (ECLGS) is under the operational domain of Ministry of Finance, Department of Financial Services (DFS). As informed by DFS, as on 2.07.2021, guarantees have been issued for loan granted to around 1.09 crore Micro, Small and Medium Enterprises (MSMEs).

ECLGS being a demand driven scheme, sanctions/disbursements are made by lending institutions based on assessment of borrower’s requirement and their eligibility.

The eligibility criteria for availing credit under ECLGS are:

For ECLGS 1.0, MSME units, Business Enterprises, Mudra Borrower and individual loans for business purpose having loan outstanding upto Rs.50 crore and days past due upto 60 days as on 29.02.2020.
For ECLGS 2.0, Borrower belonging to 26 stressed sectors identified by Kamath Committee & Healthcare sector having loan outstanding above Rs.50 crore and upto Rs.500 crore and days past due upto 60 days as on 29.02.2020.
For ECLGS 3.0 Borrower belonging to Hospitality, Travel & Tourism, Leisure & Sporting and Civil Aviation sector having days past upto 60 days as on 29.02.2020.
For ECLGS 4.0 Existing Hospitals/Nursing Homes/Clinics/Medical Colleges/units engaged in manufacturing of liquid oxygen, oxygen cylinders etc. having credit facility with a lending institution with days past due upto 90 days as on March 31, 2021.

As on 2.07.2021 an amount of Rs.2.73 lakh crore have been sanctioned under the scheme of which an amount of Rs.2.14 lakh crore has been disbursed.

The scheme was designed to support existing borrowers meet the liquidity crisis due to Covid-19 pandemic. Ministry of MSME has launched Credit Guarantee Scheme for Subordinate Debt (CGSSD) to extend financial assistance to stressed MSMEs including NPA accounts. The credit needs of the first time bowers belonging to the Micro and Small Enterprises are catered to by the Credit Guarantee Scheme for Micro and Small Enterprises.

This information was given by Minister for Micro. Small and Medium Enterprises Shri Narayan Rane in a written reply in the Rajya Sabha today.

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Loans to MSMES Industries under CGS

Posted on 19th Jul 2021 by Business So Simple in MSME

Ministry of Micro,Small & Medium Enterprises posted Date:- Jul 19, 2021

All new and existing Micro and Small Enterprises engaged in manufacturing or services including trading activity are eligible to be covered under Credit Guarantee Scheme (CGS) implemented by Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE). No eligible proposal is denied. Upto June 30, 2021 CGTMSE has approved 53,86,739 guarantees cumulatively for an amount of Rs. 2,72,007 crore. During the first quarter of Financial Year 2021-22 CGTMSE has reported that guarantee approvals with respect to Banks and NBFCs are Rs. 6,693 crore and Rs. 6,603 crore respectively during first quarter of Financial Year 2021-22 as against Rs. 6,041 crore and Rs. 2,934 crore respectively during first quarter of Financial Year 2020-21.

During Financial Year 2020-21, CGTMSE has approved 22,021 guarantee applications amounting Rs. 1,408 Crore for the State of Telangana.

Government of India has announced a relief package to support Indian Economy including the MSME Sector. This package inter-alia also includes measures such as Rs 1.1 lakh crore loan guarantee scheme for covid affected sectors, additional Rs 1.5 lakh crore for Emergency Credit Line Guarantee Scheme, Credit Guarantee Scheme to facilitate loans to approximately 25 lakh small borrowers through Micro Finance Institutions etc.

This information was given by Minister for Micro. Small and Medium Enterprises Shri Narayan Rane in a written reply in the Rajya Sabha today.

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Setting UP New Units of MSMES

Posted on 19th Jul 202119th Jul 2021 by Business So Simple in MSME

Ministry of Micro,Small & Medium Enterprises

Setting UP New Units of MSMES

Posted Date:- Jul 19, 2021

The Government of India simplified the process of registration of MSMEs by replacing the UdyogAadhaar Memorandum (UAM) with Udyam Registration (UR) on1^st July 2020. UR is free of cost, transparent, online, hassle free and is based on self-declaration. It does not require any documents and has an automatic integration with ITR and GSTIN. During the second wave of Covid -19 pandemic MSMEs continued to register on UR Portal.

MSMEs can avail the benefits of schemes such as Prime Minister Employment Generation Programme (PMEGP)/Rural Employment Generation Programme (REGP)/Micro Units Development & Refinance Agency (MUDRA) and the announcements made to provide relief to MSMEs from the problems faced due to COVID-19 pandemic. The number of Projects and Employment generation under PMEGP during 2020-21 as on July, 2021 are 91,054 and 7,28,432, respectively.

This information was given by Minister for Micro. Small and Medium Enterprises Shri Narayan Rane in a written reply in the Rajya Sabha today.

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Encouragement to MSMES

Posted on 19th Jul 2021 by Business So Simple in MSME

The Ministry of MSME implements various schemes and programmes for growth and development of MSME Sector in the country. These schemes and programmes include Prime Minister’s Employment Generation programme (PMEGP), Scheme of Fund for Regeneration of Traditional Industries (SFURTI), A Scheme for Promoting Innovation, Rural Industry & Entrepreneurship (ASPIRE), Interest Subvention Scheme for Incremental Credit to MSMEs, Credit Guarantee Scheme for Micro and Small Enterprises, Micro and Small Enterprises Cluster Development Programme (MSE-CDP), Credit Linked Capital Subsidy and Technology Upgradation Scheme (CLCS-TUS).

Post Covid-19, Government has taken a number of initiatives under AatmaNirbhar Bharat Abhiyan to support the MSME Sector in the country especially in Covid-19 pandemic. Some of them are:

i) Rs 20,000 crore Subordinate Debt for MSMEs.

ii) Rs. 3 lakh crores Collateral free Automatic Loans for business, including MSMEs.

iii) Rs. 50,000 crore equity infusion through MSME Fund of Funds.

iv) New revised criteria for classification of MSMEs.

v) New Registration of MSMEs through ‘Udyam Registration’ for Ease of Doing Business.

vi) No global tenders for procurement up to Rs. 200 crores, this will help MSME.

An online Portal “Champions” has been launched on 01.06.2020 by Hon’ble Prime Minister. This covers many aspects of e-governance including grievance redressal and handholding of MSMEs. Through the portal, total 35,361 grievances have been redressed upto 12.07.2021.

Studies have been conducted by National Small Industries Corporation (NSIC) and Khadi and Village Industries Commission (KVIC) to assess the impact of COVID-19 Pandemic on MSMEs including units set up under Prime Minister’s Employment Generation Programme (PMEGP).

The main findings of the online study conducted by NSIC to understand the operational capabilities and difficulties faced by the beneficiaries of NSIC schemes amid Covid-19 pandemic are as follows:

91% MSMEs were found to be functional.
Five most critical problems faced by MSMEs were identified as Liquidity (55% units), Fresh Orders (17% units), Labour (9% units), Logistics (12% units) and availability of Raw Material (8% units.)

The findings of the study conducted by KVIC are as under:

i. 88% of the beneficiaries of PMEGP scheme reported that they were negatively affected due to Covid-19 while the remaining 12% stated that they were benefitted during Covid-19 Pandemic.

ii. Among the 88% who were affected, 57% stated that their units were shut down for some time during this period, while 30% reported drop in production and revenue.

iii. Among the 12% who had benefitted, 65% stated that their business increased as they had units in retail and health sector and around 25% stated that their units benefitted as they were dealing with essential commodities or services.

iv. On the question of regular payment of salaries to the employees, around 46.60% respondents stated that they had paid the salaries in full, 42.54% reported to have partially paid and 10.86% reported to have not paid salary for some time during this period.

v. Majority of the beneficiaries expressed the need for additional financial support, relaxation of waiver of interest and marketing support for their products.

This information was given by Minister for Micro. Small and Medium Enterprises Shri Narayan Rane in a written reply in the Rajya Sabha today.

Ministry of Micro,Small & Medium Enterprises

Posted Date:- Jul 19, 2021

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