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As the Union Budget 2025 nears, India's microenterprises comprising 98.5 per cent of the MSME sector are calling for easier access to credit, reduced compliance burdens, and a more supportive policy environment.
Given their significant role in employment generation, particularly in rural and semi-urban areas, microenterprises are seen as key drivers of India's Atmanirbhar Bharat vision and the goal of a USD 5 trillion economy. Lakshmi Venkatesan Venkataraman, Founding and Managing Trustee, Bharatiya Yuva Shakti Trust, said, "One of the key concerns for microentrepreneurs is access to timely and adequate credit. While fintech firms and NBFCs process loans in a few days, banks still take 2-3 months, causing delays." She added, "The current loan size under the MUDRA scheme, particularly in the Shishu category, averages Rs 37,000, which is insufficient for microentrepreneurs to expand and sustain their businesses effectively. Increasing loan amounts, providing up to 4 per cent interest subvention, lowering margin money requirements from 25 per cent to 10 per cent, and reducing processing fees will ease financial stress on micro businesses. Additionally, loan processing and credit guarantee fees should be reduced to 0.25 per cent." The GST exemption limit should be increased from Rs. 40 lakh (goods) and Rs. 20 lakhs (services) to Rs. 1 crore. "Microenterprises currently file 13 GST returns annually, adding to their administrative burden. A single-window clearance system for licensing and compliance can further help streamline operations. Additionally, sole proprietorships and partnerships should receive the same three-year tax holiday as Pvt. Ltd. companies and LLPs." Women entrepreneurs face additional challenges, with 85 per cent struggling to secure loans, according to a recent survey. To support digital growth, microenterprises are seeking subsidies for digital adoption, e-commerce integration, and cybersecurity training. The removal of transaction fees for digital payments up to Rs20,000 and additional funding for platforms like ONDC will help small businesses scale digitally. Sustainability is another area where microenterprises need support. Experts recommend green financing schemes and incentives for using recyclable materials, enabling microbusinesses to adopt ESG best practices and operate sustainably. Infrastructure development is also crucial. A 25 per cent increase in infrastructure spending, particularly in Tier 3 and Tier 4 towns, will improve logistics, reduce costs, and enhance market access. Additional support for agriculture, education, and healthcare, including increasing public health spending to 2.5 per cent of GDP and lowering GST on health insurance policies, will further benefit microentrepreneurs and their workforce. (ANI)
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