by Apparel Resources News-Desk
16-October-2019 | 1 min read
The Apparel Export Promotion Council (AEPC) has urged the Central Government to ensure that banks do not declare any stressed loan account of micro, small and medium enterprises (MSMEs) as non-performing assets (NPAs), as promised.
Earlier, the finance ministry had given MSMEs the time till March 2020 after which the loans they failed to repay would be declared as NPAs.
The banks have been asked to work on recasting debts.
“The ministry further said several MSMEs want one-time settlement of outstanding dues, which should be settled expeditiously by the banks. The Central Government wants banks to recast MSME loans instead of declaring it as NPA,” said AEPC acting Chairman A. Sakthivel.
“Despite the Government’s announcement, the banks are currently announcing NPAs of such accounts, and they are showing lack of interest in recasting the debt. Many industrial units are eligible to run if they are given a re-construction of loans with additional working capital, which can be evaluated and sanctioned on merit basis.
Since the export is time-sensitive business, any delay in catering to the client will make them move to other competitive countries. We observed that reduction of powers to branch heads of the nationalised banks causes enormous delays in getting the loans,” he said.
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