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    44% MSMEs feel stimulus package not good enough

    Synopsis

    Forty four per cent of respondents said the relief measures announced by the government earlier this week did not meet expectations and 86% wanted direct cash support from the government.

    The most immediate challenge for MSMEs remains paying salaries, discharging vendor bills, and meeting other fixed expenses, with around 77% of the surveyed businesses citing need for emergency funds, the survey said.
    New Delhi: Over three-fourths of micro, small and medium enterprises (MSMEs) in the national capital region have cut employee salaries while nearly two-third are resorting to layoffs after seeing no rise in demand, a private survey showed.

    Forty four per cent of respondents said the relief measures announced by the government earlier this week did not meet expectations and 86% wanted direct cash support from the government.

    The most immediate challenge for MSMEs remains paying salaries, discharging vendor bills, and meeting other fixed expenses, with around 77% of the surveyed businesses citing need for emergency funds, the survey said.

    The Survey was conducted by Skoch Consultancy Services in association with Federation of Indian Micro and Small & Medium Enterprises (FISME), Bhartiya Vitta Salahkar Samiti and Tax Law Educare Society.

    The business sentiment for survival, however, has improved.

    In May 2020, the number of MSMEs cutting all jobs rose to 6% from 4% in April. Another 30% are planning to cut half the jobs and 26% are planning to reduce a quarter of the jobs.

    The survey sought response to the Atma Nirbhar Bharat package announced by the Finance minister Nirmala Sitharaman earlier this month. It was conducted among 200 members of FISME in the National Capital Region.

    On the overall Atma Nirbhar Package cutting across all sectors, 32% respondents found it useful, 44% did not, the survey revealed.

    “Overall sense is that the package was difficult to understand and not addressing the felt-needs that MSMEs have and therefore the mood overall is grim,” the survey results, accessed exclusively by ET, said.

    Sector analysts and market watchers too have favoured a direct benefit transfer for MSMEs like was done for Jan Dhan Accounts to take care of immediate expenses that cannot be met due to the loss of income.

    Though there was a considerable dip in the uncertainty over business sentiment, 59% respondents still feel that their business cannot survive without government help. This is down from 77% in April 2020.

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    16 Comments on this Story

    Mani Arjun42 days ago
    govt is earning from the blood of msme or common man no relief on loans, no cash on hand, no relief on electricity Bill's this govt paid nothing to people of India only earning and earning from the common man, why can't you make no payment of electricity for 4months, now summer 2hrs shutdown started, if we run production on generators where will be money, no thinking about common man
    Mani Arjun42 days ago
    Let ministry directs PSU not cancell orders, ask them to extend sufficient delivery period, ask them to release all security DEPOSITS held against orders, as no money from stimulus, at least we can survive with our money, ask psu no torture MSME 1000s of paper work for invoice all online payment within 1week no hank panky & cheating already debt ridden msme, whether ministry hv guts
    U.R. RADHAKRISHNAN42 days ago
    Banks are still reluctant insipte of government guidelines. Banks still say they ate working on it. Hope will get20% before we stop production. God only can save.
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