(MENAFN- KNN India) New Delhi, Oct 8 (KNN) Around Rs 8 trillion in credit has been extended to India's micro, small and medium enterprises (MSMEs) over the past three years, supported by coordinated efforts between the Reserve Bank of India (RBI) and the government, according to Girish Luthra, President, FICCI-CMSME.

Speaking to ANI on the sidelines of the 11th FICCI-CMSME Summit in New Delhi, Luthra said the policy focus on easier access to finance has significantly strengthened MSME participation in India's industrial and procurement ecosystem.

“RBI, together with the government, has been working very closely to make finance easier for MSMEs. One of the major challenges was related to guarantees or collateral requirements. The government addressed this by creating a threshold-initially one crore, and now up to ten crores-where MSMEs can access funds without collateral,” Luthra said.

Highlighting the need for broader awareness, Luthra emphasised that many MSMEs remain unaware of existing government support schemes.

To address this, FICCI-CMSME, in collaboration with the Ministry of MSME and NSIC, plans to conduct 100–200 outreach programs across the country to help enterprises access available benefits and resources.

He noted that digital platforms such as the Government e-Marketplace (GeM) have further empowered enterprises by improving transparency and sustainability in public procurement.

“GeM and its focus on sustainability are making a real difference for MSMEs. With over six million enterprises forming the backbone of this sector, FICCI-CMSME remains the only large confederation focusing exclusively on their growth and government support is helping us do a great job,” he added.

According to Luthra, MSMEs now account for about 45 percent of public procurement, reflecting the growing integration of small businesses into the formal economy.

Addressing concerns about Non-Performing Assets (NPAs), he clarified, "It's a common misunderstanding that MSMEs contribute heavily to NPAs. In reality, NPAs in the MSME sector are only 3.9 percent, which is far lower than that of large organisations. This low risk is why the RBI has supported collateral-free funding for MSMEs."

On ease of doing business, he said, "Interstate competition is improving outcomes because each state wants to perform better than the other. Implementation happens at the state level, and this competition is proving very effective."

Discussing domestic challenges, he added, "Labour reforms over the past two years have reduced production losses due to workforce issues significantly. Similarly, state governments are relaxing land laws, and cluster-based industrial approaches now allow MSMEs to set up plug-and-play operations with all titles cleared - this is the most effective model."

(KNN Bureau)

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