MSMEs’ GST refund dues to be settled in a month

New Delhi: In a move that will ease liquidity for micro, small and medium enterprises (MSMEs), finance minister Nirmala Sitharaman on Friday said all pending GST refunds will be paid within the next 30 days, while future dues will be settled in 60 days. The government also plans to amend the MSME Act to provide a single, holistic definition for MSMEs, it said as part of the measures announced to revive the economy.

“If the refund comes within such a short span of time, it will improve the liquidity of the sector which is really going to help. Working capital always becomes an issue for the small and medium enterprises,” said Arun Kumar Panda, secretary, MSME.

The government said it will implement some of the key recommendations of the UK Sinha panel relating to the ease of credit, marketing and technology upgrade for MSMEs. The recommendations are expected to be implemented in the next 30 days.

Banks and NBFCs are simultaneously partnering through co-organisation, which is particularly helpful for MSME borrowers, said the ministry. “MSMEs have been a priority for us beyond just the partnerships with banks. We will focus on getting money to MSMEs faster from GST and government buyers.” The government also expects MSMEs to benefit from the infra thrust and unlocking of payments held up due to arbitration.

“We are very encouraged… These will definitely ease the credit flow for MSMEs. We hope that in the coming days, we are provided more clarity on some of these issues faced by the industry, including the 59-minute loan scheme,” said Ashok Saigal, co-chair, CII MSME committee.

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