2020 was challenging to the basic livelihood of millions and the economy due to the Coronavirus (COVID-19) pandemic. The National Statistical Office (NSO) estimates India’s Gross Domestic Product (GDP) to reduce by 7.7% during the fiscal year 2020–21, as the pandemic has severely affected the services and manufacturing sectors.
Finance Minister Nirmala Sitharaman presented the Budget 2021, as the world is slowly recovering from the pandemic. There were several measures proposed for small and medium enterprises (SMEs), which are important for the economic development of the country.
Here are some benefits proposed by the Finance Minister for SMEs in Budget 2021:
- Changing capital and turnover limits
- Enhancing the paid-up capital from existing INR 50 lakh to INR 2 crore
- Increasing the turnover threshold from INR 2 crore to INR 20 crore
These modifications will benefit approximately two lakh companies falling under the ‘small’ category.
- Lesser compliance requirements
- Lower number of board meetings during the year
- Exemption from preparing cash flow statements
- Relaxation of rotation of statutory auditors
- Reduction in penalties
- Relaxed provisions on annual returns
These revisions under the Companies Act, 2013 will facilitate the ease of doing business in India.
- Proposed schemes for micro, small, and medium enterprises (MSMEs)
- Capital expenditure to be doubled to INR 15,700 crore
- Reduction of customs duty to 7.5% on semis, flat, and long products of alloy, non-alloys, and stainless steel
- Exemption of duty on steel scrap until March 31, 2022
- Customs duty on copper scrap to be lowered to 2.5% from the existing rate of 5%
- Faster debt resolution by strengthening the National Company Law Tribunal (NCLT) framework and setting up of e-courts
- Rise in the customs duty on synthetic finished gemstones to boost domestic processing
Financial institutions like Mahindra Finance understand the importance of SMEs and MSMEs for the Indian GDP’s growth. To help them benefit from the INR 20 lakh crore relief package announced in May 2020 and the Budget, Mahindra Finance offers affordable SME loan interest rates and other promising features.
The lender provides short-term and long-term credit solutions to meet the monetary requirements of SMEs to smoothly carry on their business operations. It offers customized loans as per business requirements, wherein the entire procedure is quick and hassle-free.
Mahindra Finance needs minimal documents for SME loan solutions. It accepts various kinds of collaterals and has flexible norms to ensure every SME can avail of funding. You can visit the financial provider’s website to check the SME loan eligibility criteria.