Budget expectations (MSMEs/ NBFC/ Fintech): Shachindra Nath, EC & MD, U GRO Capital
Shachindra Nath, EC & MD, U GRO Capital.jpg
Mr. Shachindra Nath, Executive Chairman and Managing Director, U GRO Capital
Union Budget 2022-23 is highly crucial to align Indian economy’s growth trajectory. It is essential that the Hon’ble Finance Minister announces effective measures to enable speedy recovery and growth of the MSMEs, considering the sector’s significant contribution to the economy. It is encouraging to see Government’s support for the MSME sector in last 12-15 months and we believe the efforts will only become more prominent in the time to come.
In past few years, operationally nimble and technologically oriented NBFCs and Fintechs have deepened the credit penetration to the underserved regions of the country. Hence, in the upcoming budget, policymakers should provide due consideration to boost liquidity support to the NBFCs as well as encourage frameworks like co-lending, which will greatly boost the reach of financial institutions and progress in the financial inclusion imperative. EASE 4.0 talks about Co – Lending between Banks and NBFC as a means to increase the credit penetration, however the treatment of Tax Deduction at Source (TDS) treatment for NBFC and Banks are different and that is proving to be a major operational challenge to accelerate credit. It is expected that TDS rules would be harmonised between Banks and NBFCs.
