Business Standard

Banks may be made answerable for denying loans to MSMEs, says Union minister


Press Trust of India Lucknow
Banks might be made answerable in future for refusing loans to eligible MSME players, Union Minister Pratap Chandra Sarangi said on Thursday.
The Minister of State for MSME stated that the development of the sector is often hampered due to non-cooperation of banks and his ministry was in talks with the finance ministry to address the issue.
Sarangi noted that the MSME sector creates maximum jobs at the local level and with the lowest capital. Due to less burden on the government and low investment, the risk for banks lending to them is also low, he said.
"After agriculture, MSME is the second largest sector with employment opportunities. However, the development of this sector is often hampered due to non-cooperation by bankers.
"The Centre, in collaboration with the finance ministry, is now finding a solution to this issue. In future, banks might be made answerable if they refuse loans to eligible candidates," the Union minister said.
Uttar Pradesh Chief Minister Yogi Adityanath said that around 14 lakh youths got jobs in MSMEs in the state in the last two-and-a half years.
"MSMEs will play a significant role in making India a 5-trillion dollar economy. Around 14 lakh youth got jobs in the last 2.5 years because of MSMEs, as envisioned by Prime Minister Narendra Modi," he said.
On account of its biggest manpower, the economy of Uttar Pradesh and that of the nation complement each other. MSME is the growth engine of the state, he said.
"MSMEs have a rich tradition in Uttar Pradesh. But due to lack of promotion and changes required according to market conditions, this tradition started waning. In order to revive the sector, last year during the UP Diwas the state government had announced One District One Product (ODOP) scheme," he said.
The chief minister said his government not only provided training to people associated with the sector but also provided them loans through various schemes.

Disclaimer: No Business Standard Journalist was involved in creation of this content

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Aug 29 2019 | 7:45 PM IST

Explore News