The loans announced by the Government under their Atma Norbhar Bharat Yojna comes as a huge relief for MSME and Small Startup companies that have run out of funds as a result of the lockdown induced to prevent the spread of COVID 19. This loan scheme was announced by the finance minister Nirmala Sitharaman on May 13 and he also pointed out the policies and criteria for the allocation of loans. This relief fund is a part of INR 20 lakh crore stimulus package, which was announced by PM Narendra Modi.
This relief fund for MSMEs is actually a collateral-free loan which has a corpus of 3 lakh crores. All the companies that are registered as MSMEs and fit in the eligibility criteria can get loans to support their business. There is no need for guarantee or collateral to avail the benefits of loans, Sitharaman added.
The loans will be provided for four years and another great thing about this loan package is that the companies will only have to pay interest for the first year, and from seconds year, they will only have to pay the principal amount. It is added that this relief package will help more than 45 lakhs MSMEs to resume their operations and will save them from collapsing.
IAMAI also suggested that the government should allow free movement of goods and services in all the area which are not marked as red zones. This will bring small companies on track.
The relief package was a great step taken by the government and it comes as a great aid to the small and medium-sized companies who are getting affected because of continuous lockdown.