Creative excuses’ by public, private enterprises in delaying payments hurt MSMEs in getting bank....

Credit and Finance for MSMEs: There are multiple ‘creative excuses’ used by public and private enterprises to delay supplier payments and hence most micro and small businesses face the problem of getting bank finance at reasonable rates, said Chief Economic Advisor (CEA) V Anantha Nageswaran on Friday. Addressing the delayed payments issue faced by MSMEs, the CEA strongly urged banks to ‘think about how to ensure large companies pay MSMEs on time for the latter’s working capital needs.

In his keynote address at the FE Modern BFSI Summit in Mumbai, Nageswaran said, “In what way can they (banks) make large buyers (payment) behavior a part of their loan mandate is the question I would like to leave bankers with if we have to help MSMEs grow sustainably.” Access to finance and working capital must be ensured and so whatever banks can do directly and indirectly will be of huge advantage, he added.

Read more at Financial Express