Mumbai, Apr 24 (UNI) Working group of Reserve Bank of India has suggested the state governments to introduce a single window concept to provide relief and concessions to sick Micro and Small Enterprises (MSE) besides setting up of asset Reconstructions Companies specially for micro, small and medium enterprises.
The Working Group on rehabilitation of sick SMEs headed by Punjab National Bank Chairman and Managing Director K C Chakraborty also wanted the government to take medium enterprises out of the purview of BIFR and the banks given the responsibility for their rehabilitation, as only a fraction of medium enterprises were covered under the Sick Industries companies (Special Provisions) Act 1985 (SICA) and their rehabilitation done under the supervision of BIFR.
RBI has posted a 120-page report for comments in its website.
The Working Group had come out with various recommendations, measures and actions which need to be taken by Banks, NABARD, SIDBI and RBI besides State Governments for enhancing credit flow to the SME sector as well as for early implementation of rehabilitation or nursing of sick SME units.
The mandate to the Working Group included examining feasibility to bring additional capital to sick SMEs through alternative routes such as equity participating and venture financing.
The report said, as an incentive for proper restructuring package at the time of rehabilitation, necessary support for business restructuring, modernisation, expansion, diversification and technical upgradation as might be felt necessary by lenders might be encouraged. Support schemes such as Credit Linked Capital Subsidy Scheme in case of units other than rural areas, KVIC Margin Money Scheme for units in rural areas may be extended for rehabilitation packages also.
More UNI VK GR AG1550