MSME Urges Indian Corporates to Prioritise Timely Payments to Small and Medium Enterprises

The Ministry of Micro, Small and Medium Enterprises (MSME) has urged Indian corporates to prioritise settling dues owed to small and medium enterprises (SMEs). These payments are crucial for the operational continuity and job security within the sector. The government has reached out directly to the top 500 corporate groups, sending e-letters to their owners, chairpersons, or senior executives.

The ministry highlighted that these payments are vital for countless individuals whose livelihoods depend solely on MSMEs. It also mentioned plans to engage other corporates through social media outreach. This initiative aims to ensure that SMEs receive timely payments, which is essential for their financial health and sustainability.

In line with the Aatmanirbhar Bharat package announcement, it was emphasised that MSME dues should be cleared within 45 days. Ministries and Central Public Sector Enterprises (CPSEs) have reportedly paid around Rs 10,000 crore in dues. This move is part of a broader effort to support the MSME sector during challenging times.

The ministry reminded corporates of the requirement to file half-yearly returns with the Ministry of Corporate Affairs regarding their outstanding dues to MSMEs. Corporates not yet complying have been urged to start filing these returns promptly. This measure aims to enhance transparency and accountability in corporate dealings with MSMEs.

Additionally, the ministry encouraged corporates to participate in the Trade Receivables Discounting System (TReDS). Since 2018, onboarding onto the TReDS platform has been mandatory for all CPSEs and corporate entities with a turnover exceeding Rs 500 crore. This system facilitates faster payment cycles for MSMEs by enabling them to discount their receivables.

The ministry's efforts underscore the importance of timely payments to SMEs, which play a significant role in India's economy. By ensuring that corporates meet their financial obligations, the government aims to bolster the resilience of the MSME sector and safeguard jobs across the country.