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The last mile traders in distribution chain is still waiting to get financial assistance under Prime Minister MUDRA Yojna, said B C Bhartia, National President of Confederation of All India Traders (CAIT). A delegation of CAIT B C Bhartia and Praveen Khandelwal General Secretary met Dr Kshatrapaty Shivaji, Chairman and Managing Director of SIDBI and Ji Ji Mammen, CEO of Micro Units Development and Re-finance Agency at Mumbai. Bhartia and Khandelwal appraised the authority regarding non availability of finance to small retailers across the country. Bhartia explained that under MUDRA Yojna the concept was to have an independent financial structure comprising of small business finance units who have greater access to small people. “Even, if the existing structure of commercial banks are able to give loans but in true sense and in long run they will not be in a position to service these loans. A concrete road map has to be prepared to make this a strong and effective financial structure to ensure financial empowerment to small retailers. Praveen Khandelwal explained the efforts taken by Confederation of All India Traders (CAIT) through action committee for new financial architect to make this Yojna. He said that such an important machination of financial architecture could not be left to be run on traditional commercial bank lending methods. Bhartia said, “The non-corporate small business sector is vast. Loosely referred to as the unorganised or informal sector, they are mostly self organised. A large portion of this sector runs as Own Account Enterprises (OAEs), with no employees essentially self employment. There are about 5.77 crore such enterprises in our country.” Non-corporate small business account for a large share of industrial units. They feed large local and international value chains as well as domestic consumer markets as suppliers, manufacturers, contractors, distributors, retailers and service providers. The non-corporate small business sector accounts for 45 per cent of India’s GDP, far ahead of every other sector of the economy. The gross value addition of this sector is Rs. 6.28 lakh crore annually. “The non-corporate small business enterprises employ 46 crore people. Of these, 24 crore are self employed. Contrast this with the corporate sector, where despite liberalisation and globalization, employment increased only by 22 lakh in 20 years between 1991-2011,” he said. About, 57 per cent of all non-corporate enterprises are owned by backward classes in urban India and 61 per cent in rural India making them the biggest source of livelihood for weaker sections of society. The best way to ensure SCs and STs get employment is to promote them as entrepreneurs, like how the OBCs have done. The greatest bottleneck to the growth of entrepreneurship in the non-corporate small business sector is lack of finance support. The support from Banks to this sector is meagre, with less than 15 [per cent of bank credit going to MSME. A vast part of the non corporate sector operates as unregistered enterprises, and banks find it difficult to lend to them. More than 90 per cent of this sector does not access outside source of finance. Dr Shivaji and Ji Ji Mammen gave a patient hearing and said that lot of efforts have been made by existing banking system as well as by micro finance units to make more and more funds available in the market. He assured the delegation that every body in concerned about availability of funds at the lowest level of trade.
Keywords
financial assistance, Prime Minister, MUDRA Yojna, CAIT, SIDBI, Bhartia, small business, commercial banks, CAIT
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