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<keyword id="19956758" type="General" weightage="20" keywordseo="finance-minister" source="keywords">Finance Minister</keyword> <keyword id="19916618" type="General" weightage="20" keywordseo="nirmala-sitharaman" source="keywords">Nirmala Sitharaman</keyword> on Tuesday announced a <keyword id="20274081" type="General" weightage="20" keywordseo="credit-guarantee-scheme" source="keywords">credit guarantee scheme</keyword> for facilitating <keyword id="22087606" type="General" weightage="20" keywordseo="term-loans" source="keywords">term loans</keyword> for <keyword id="19910977" type="General" weightage="20" keywordseo="MSMEs" source="keywords">MSMEs</keyword> to purchase machinery and equipment without collateral or third-party guarantee. In her Budget speech in the Lok Sabha, she said the Budget provides special attention to micro, small &amp; medium enterprises (MSMEs) and manufacturing, particularly labour-intensive units. "We have formulated a package, covering financing, <keyword id="20961204" type="General" weightage="20" keywordseo="regulatory-changes" source="keywords">regulatory changes</keyword> and technology support for MSMEs to help them grow and also compete globally, as mentioned in the interim budget," she said. The credit guarantee scheme for MSMEs in manufacturing will operate on the pooling of credit risks of such entities. "A separately constituted self-financing guarantee fund will provide, to each applicant, guarantee cover up to Rs 100 crore, while the loan amount may be larger," the minister announced in the Budget. The borrower will have to provide an upfront guarantee fee and an annual guarantee fee on the reduced loan balance. She also announced a new mechanism for facilitating the continuation of bank credit to MSMEs during their stress period. Sitharaman said that while being in the 'special mention account' (SMA) stage for reasons beyond their control, MSMEs need credit to continue their business and avoid getting into the NPA stage. "Credit availability will be supported through a guarantee from a government-promoted fund," she added. In another move to help MSMEs, the minister announced a new assessment model for credit to the sector. She said public sector banks will build their in-house capability to assess MSMEs for credit, instead of relying on external assessment. "They will also take a lead in developing or getting developed a new credit assessment model, based on the scoring of digital footprints of MSMEs in the economy," she added. The new assessment model, she said, is expected to be a significant improvement over the traditional assessment of credit eligibility based only on asset or turnover criteria. It will also cover MSMEs without a formal accounting system. Mohammad Athar (Saif), partner and leader capital projects and infrastructure development, PwC India, said the credit guarantee scheme and <keyword id="22514802" type="General" weightage="20" keywordseo="e-commerce-export-hubs" source="keywords">e-commerce export hubs</keyword> for MSMEs will enable demand creation and boost India's aspiration of achieving USD 1 trillion in exports by 2030, driven by MSMEs. Sitharaman also announced that to enable MSMEs and traditional artisans to sell their products in international markets, e-commerce export hubs will be set up in public-private-partnership (PPP) mode. These hubs, under a seamless regulatory and logistic framework, will facilitate trade and export-related services under one roof. Vivek Jalan, Partner, Tax Connect, a multi-disciplinary firm, said, as requested by the trade and industry bodies and laid down by the Economic Survey, for MSME businesses, the compliance burden is also sought to be relaxed. Litigations will be reduced in the new <keyword id="22517694" type="General" weightage="20" keywordseo="Vivaad-Se-Vishwas-Scheme" source="keywords">Vivaad Se Vishwas Scheme</keyword>, he added. Rumki Majumdar, Economist, Deloitte India, said the credit guarantee schemes for MSMEs in the <keyword id="19955573" type="General" weightage="20" keywordseo="manufacturing-sector" source="keywords">manufacturing sector</keyword>, facilitating term loans for the purchase of machinery, and formulating packages to finance technology support to them will go a long way to providing access to finance and increasing investments, which have been key challenges in the sector.

FM announces credit guarantee scheme, other measures for MSMEs

<div type="image" title="The RBI has cracked the regulatory whip on NBFCs and banks, who&amp;#39;ve been pushing microfinance and unsecured loans aggressively to grow their loan books." agency="ANI" msid="114778648" hostid="261" caption="&amp;lt;p&amp;gt;The RBI has cracked the regulatory whip on NBFCs and banks, who&amp;#39;ve been pushing microfinance and unsecured loans aggressively to grow their loan books.&amp;lt;/p&amp;gt;"></div> Imagine this. You have a younger sibling you’re mighty envious of. And why not? Unlike you, they seem to enjoy all the freedom and money in the world. They party like there’s no tomorrow, and here you are, stuck in a boring, ultra-disciplined but responsible routine that feels completely devoid of any independence, and mostly, funds. But of late, things are changing. This sibling is in massive trouble and just cannot escape the parent’s wrath anymore. Long story short, the party is over, and it is time to go back home. The rising defaults on this sibling’s part have now begun pulling the entire house down, thereby attracting the regulator’s ire. <h2>The Wild West of <keyword id="113684" type="General" weightage="20" keywordseo="microfinance" source="Orion">microfinance</keyword> and unsecured loans</h2>It's hard to ignore the issues with microfinance and unsecured loans in India. Many saw them as a small gamble and ignored the rising defaults much like the younger siblings’ tantrums, and now they find themselves in hot waters. The skyrocketing instances of non-payments aren't a micro-issue anymore and are threatening the stability of the entire banking system. In the quarter ended September 30, 2024, 5 of India’s 8 largest private sector <keyword id="19934118" type="General" weightage="20" keywordseo="banks" source="keywords">banks</keyword> reported a steep rise in their bad loan book, mostly thanks to microfinance loans. Some banks, in a bid to strengthen their fortress against these <keyword id="142154" type="General" weightage="100" keywordseo="bad-loans" source="Orion">bad loans</keyword>, have significantly upped their provisions. For instance, IndusInd Bank set aside Rs 525 crore during July and September 2024 to battle the menace of defaults on microfinance loans, which make up about 9% of its total loan book. See, banks rely heavily on their interest income, which they earn from advancing loans. Any loan where the borrower has not paid interest to the bank or defaulted for 90 days or more becomes bad, i.e. an NPA, or non-performing asset for the bank. And who likes things going bad? Simply put, there has been a steep rise in three areas, much to the dislike of banks and MFIs (micro-finance institutions). But hey, it's mostly their doing! <ol><li>GNPA ratio (gross net performing assets): The quantum of non-performing assets a bank has in proportion to its total assets.</li><li>Provision: The amount banks set aside to take care of such NPAs.</li><li>Slippage ratio: The rate at which good girls go bad, or the speed at which good loans turn into NPAs</li></ol>But how are these plaguing the Indian banking sector? And what does the road ahead look like? We decode it for you. <h2> Microfinance: A not-so-micro-menace</h2>Microfinance loans were initially brought forth for low-income households and individuals i.e. for those who might not generally have access to traditional ways of credit, like bank loans and more. They don’t require collateral or an asset to be pledged in lieu of the loan, making it a tad bit easier for borrowers. As of June 2024, the amount of outstanding loans in the microfinance industry stood at a staggering Rs 4,20,256 crore. Of this, NBFC-MFIs accounted for 40% and banks made for 33% of these. In 2022, RBI, in a bid to inspire some competition in this space, did something radical-they did away with the ceiling on how much interest MFIs could charge their customers. Previously, MFIs could add up to 12% to their cost of acquiring funds to determine the final interest rate chargeable to the consumer. So, assuming that Bank A incurs a 5% cost to acquire funds for further loaning, A could charge up to 17% interest from the end consumer. So, interest rates were in the hands of MFIs, and boy, did they have a gala time with it. Instead of spurring some healthy competition, as RBI expected, MFIs and banks went rogue and all guns blazing, competing for the title of “Who will charge the highest interest?” Recently, RBI banned 4 microfinance institutions (MFIs), namely Asirvad Micro Finance Limited, Arohan Financial Services Limited, DMI Finance Private Limited, and <keyword id="20117932" type="General" weightage="20" keywordseo="navi-finserv" source="keywords">Navi Finserv</keyword> from disbursing loans effective October 21, 2024. Why? Because they were charging 14% extra interest over their original cost of funds. To maintain their loan books (and pockets), banks and NBFCs resorted to shady practices like netting off loans, which RBI has now advised MFIs against. Here, lenders allow borrowers to settle a previous outstanding loan by issuing them a new loan! As crazy as it sounds, it helped banks to report less of their total assets as NPAs, since the new credit would cover pending instalments of the borrower’s previous loan. Then there was the issue of borrowers overleveraging, i.e. taking multiple loans using different IDs from various lenders and then failing to honour any of them. The consequence? Banks and NBFCs end up with massive NPAs. Data from credit bureaus suggests that over the last quarter, there was a 17.2% rise in the number of borrowers who had 5 or more active loans at the same time. <h2>Growth &gt; Caution</h2>It's an age-old tale unfolding yet again in India’s banking sector- Icarus flew too close to the sun and eventually, fell to its death. Between April and June 2024, NBFCs microfinance portfolio jumped by 2.7%. If you see this in terms of loan sources, microfinance loans issued by banks grew by 11.2% in Q1FY25. But the same portfolio in NBFCs swelled by almost double-23.9%. While most of these loans had an average ticket size between Rs 30,000-50,000, there was a sharp spike in the number of loans that had a ticket size of Rs 80,000 or more. Data suggests that as of March 2024, more than 12% of all microfinance borrowers had over 4 or more active loans. In dating parlance, this is a classic case of borrowers going polyamorous, minus the honesty and transparency. Not the best of situations, you'd agree! <h2>Will banks and NBFCs stand up to this stress?</h2>If their results for Q2FY25 are to be believed, NBFCs are not handling the pressure all that well. Or even slightly well. Only a few banks like Bank of Baroda (BoB), ICICI, and Indian Bank were up for the battle, even witnessing a decline in their loan delinquencies. Some others, like IndusInd Bank, saw their stock dip by a massive 16.2% over the last 5 days. Its slippages in the previous quarter burgeoned from Rs 15.3 billion in Q1FY25 to Rs 17.9 billion in Q2. As a result, the bank pushed a staggeringly high amount of money to create an NPA cushion for itself. While its management has highlighted its preference for secured lending, that was hardly reflected in its actions during the quarter, where growth in unsecured personal loans remained exceptionally high at over 7% on a QoQ basis. Turns out, only 44% of customers in IndusInd Banks’ microfinance loan portfolio were exclusive to it. The rest 47% were, you guessed it right-polyamorous! 27% had borrowed from another lender as well, apart from IndusInd Bank, while 20% were those who had outstanding loans with two other lenders, apart from IndusInd Bank. IndusInd Bank’s credit card segment did not miss the NPA bus and accounted for 7-8% of its GNPAs. Canara Bank’s total slippages during the previous quarter jumped to Rs 11.1 billion, up by 24.7% QoQ, and making up for 3.6% of its total loans. As for Bandhan Bank, its gross NPA for Q2FY25 inched up on a QoQ basis, up from 4.23% in Q1, to 4.68% in the second quarter. IDFC Bank’s heavy provisioning for its NPAs marred its profits significantly, causing its PAT (profit after tax) to dip by 73% on a YoY basis. Data from ICRA Analytics suggest that the AUM (asset under management) growth in microfinance loans and unsecured (personal and business) loans by the NBFCs will moderate to 10-12% and 19-21%, respectively, in FY2025 compared to 30% and 38%, in FY2024. Says A M Karthik, Senior Vice President &amp; Co-Group Head, Financial Sector Ratings, ICRA, “As bank funds constitute a larger share in the overall funding of NBFCs, a slower credit flow from banks to the NBFCs will compress their AUM growth. The NBFCs in unsecured and digital lending businesses shall face a higher squeeze in funding compared to others, and the unsecured lending space will continue to be a source of stress in the near term.” There has been uninhibited growth in <keyword id="6051027" type="General" weightage="20" keywordseo="Unsecured-loan" source="Orion">unsecured loan</keyword>s, apart from just the microfinance segment. For instance, Axis Bank’s gross slippages jumped by Rs 4,443 crore, largely thanks to its unsecured business. The same is the case with Yes Bank, which saw 35–40% of its retail slippages emerging from the unsecured loan portfolio. <keyword id="6376194" type="General" weightage="20" keywordseo="kotak-mahindra" source="Orion">Kotak Mahindra</keyword> Bank was also quick to follow Yes Bank’s suit, with around 35%-40% of its slippages coming from credit cards. <h2>How is the road ahead?</h2>While RBI has just cracked its whip and served a warning at the moment, experts at Morgan Stanley believe that more changes (read regulatory lashes) are underway. Moreover, with both festive and wedding seasons underway in our country, unsecured lending might pick up momentum, much to the disdain of the calibrated approach banks have been taking towards it so far. But if the situation doesn't improve, RBI will not waste any time in becoming the typical tyrannical <keyword id="19897820" type="General" weightage="20" keywordseo="bollywood" source="keywords">Bollywood</keyword> headmaster who runs his dominion with an iron fist. However, that's a story for another day. Do you have a topic in mind you'd want a simpler explanation for, or insights or personal experience to share on personal finance and more? Contact us at businessinsider@timesinternet.in.

Simply Put: Is the lending party over? The dangerous tango of Indian banks with microfinance and unsecured loans

India's <keyword id="22879519" type="General" weightage="20" keywordseo="organised-gold-loan-market" source="keywords">organised gold loan market</keyword> is projected to double in the next five years to Rs 14.19 lakh crore despite expected moderation in growth due to stricter regulations, according to a <keyword id="19938520" type="General" weightage="20" keywordseo="PwC-India" source="keywords" meta.keywordsubtype="org" meta.entityname="PwC India" meta.hostid="153" meta.entityid="PwC India">PwC India</keyword> report. In fiscal 2023-24, the organised <keyword id="21627536" type="General" weightage="100" keywordseo="gold-loan-market" source="keywords">gold loan market</keyword> demonstrated substantial growth, reaching a valuation of Rs 7.1 lakh crore, according to the report titled 'Striking gold: The rise of India's gold loan market' . "It is expected to reach around Rs 14.19 lakh crore by FY 2029 at a five-year CAGR of 14.85 %," it said. Indian families own massive quantities of gold, estimated at 25,000 tonne. Existing gold holdings with <keyword id="19895507" type="General" weightage="20" keywordseo="Indian-households" source="keywords">Indian households</keyword> are valued at roughly Rs 126 lakh crore, the report said. It further said the gold loan market is poised to see moderate growth over the next two years, as gold lenders are facing increased scrutiny from regulatory authorities regarding loan-to-value (LTV) maintenance and auction-related procedures. "The second-largest player in the gold loan market being inactive would have an impact on market growth in FY25," the report said. Also, the <keyword id="19899808" type="General" weightage="20" keywordseo="rbi" source="keywords">RBI</keyword>'s advisory to <keyword id="19938300" type="General" weightage="20" keywordseo="NBFCs" source="keywords">NBFCs</keyword> on cash disbursement, which limits the amount of cash disbursal to Rs 20,000, could push customers to rely on the unorganised sector. The regulator has also raised concerns about the evaluation process for lending activities through fintech startups. The increased regulatory scrutiny and revised guidelines have led to a dip in the share prices of leading NBFCs, PwC said. "Gold loan lenders are expected to use this period to ensure that they are compliant with all regulatory guidelines while undertaking several measures to optimise their middle and back offices through digitisation initiatives," it said. Lenders are also expected to implement cost optimisation initiatives that will help drive up the bottom-line profitability of their companies and enhance investor confidence which has slightly depleted as a result of the regulatory scrutiny. Furthermore, the report said rising gold prices over the past financial year may also drive lenders to take a cautious approach to lending rates and pricing as any downward movement in gold prices will result in a substantial LTV breach that will further create operational issues for lenders in the form of auctions. "The growth of the gold loan market is expected to be steered by both banks and NBFCs," the report said. The emergence of digital gold loan aggregator platforms and their strategic collaboration with gold loan lenders such as banks and NBFCs will be a key driving factor for the growth of the industry, enabling gold loan lenders to tap into a previously untapped segment of digitally savvy customers. "While the forecasted growth of the gold loan market means potential growth for all players, the impact on the players may vary. Banks are expected to benefit from their lower interest rates," PwC said. Jaikrishnan G, Partner (Financial Services), PwC India said lending against gold is the oldest form of credit. It remains one of the most attractive options for consumer as well as lenders. "High return-on-assets, manageable risk, timely regulatory interventions, growing adoption, tech-enabled operating models have all contributed to sector growth. As India embraces the vision of Viksit Bharat, gold loans will provide much needed liquidity and credit access to growing small and medium entrepreneur segments," he said. The report further said growth by NBFCs is expected to be fuelled by their expansion and increased outreach to regions with low penetration, bringing new credit customers to the financial services ecosystem. Also, fintechs will play a critical role in bringing in the required technology and innovation into the industry, thus helping lenders to create unique product propositions to boost growth, it said. <keyword id="20037818" type="General" weightage="20" keywordseo="South-India" source="keywords">South India</keyword> contributes to a vast extent, as it emerges as the dominant market for gold loans, with 79.1% share of the total outstanding loans. The report also noted that an assumption can be made that the entire Rs 126 lakh crore worth of gold will not be available for pledging due to various reasons like jewelry belonging to religious institutions, jewellery with emotional value, and certain jewellery held by individuals who are not in need of finance.

Gold loan market projected to double in 5 years to Rs 14.19 lakh crore, says PwC India's report

<ul class="summary-list"><li>Investment firms want to offer private-credit ETFs to ordinary investors, the WSJ reported. </li><li>It would give retail investors access to a $1.7 trillion market. </li></ul>A booming corner of the financial markets that has only been available to institutions might soon be open to everyday investors. <a target="_blank" class="" href="https://www.wsj.com/finance/investing/wall-street-races-to-bring-private-credit-to-the-masses-8a25b624?mod=finance_lead_story">According to The Wall Street Journal,</a> some of the biggest private equity and investment management giants want to offer retail investors access to exchange-traded funds backed by private credit. The term broadly refers to loans made to companies and consumers by nonbank lenders. Historically, fund managers have sold "alternative assets" like private debt to institutional investors at a high cost, generating returns of around 10% in recent years — more than they would have seen from investing in the stock or bond markets.Now, as those institutions slow allocations to private credit, the biggest players in the space want to target a new class of investors. According to the Journal, firms like State Street, Apollo Global Management, and BlackRock are working to roll out private credit ETFs to regular investors. The challenge, though, is building a highly liquid ETF out of illiquid private loans. That hurdle is also what will likely draw the eye of regulators as they ensure the ETFs are appropriate for retail investors. But if these ETFs get approved, they will enable regular investors to tap into a booming market, one that BlackRock expects will more than double to $3.5 trillion by 2028. The race to launch private credit ETFs has heated up in recent months.In May, Capital Group and KKR teamed up to start offering funds investing in both public and private assets—including in private credit—starting next year.Last month, State Street proposed a private debt ETF to the Securities and Exchange Commission. The ETF would blend public debt with private debt on mortgage, corporate, and consumer loans purchased from Apollo Global Management. Anna Paglia, State Street's chief business officer, <a target="_blank" class="" href="https://investors.statestreet.com/investor-news-events/press-releases/news-details/2024/State-Street-Global-Advisors-and-Apollo-Global-Management-Join-Forces-to-Increase-and-Broaden-Investor-Access-to-Private-Markets/default.aspx">said in a statement</a> the ETF would "democratize access to private asset exposures," and make them "more accessible to a wider swathe of investors.""It is our goal to bring these investments to scale and help facilitate the process of making private assets more accessible and liquid over time. We see this as only the beginning of a new wave of innovation as public and private markets increasingly converge," Paglia said. Alternative assets make up a small share—less than 3%—of individual investors' global investments, KKR's head of Global Client Solutions Eric Mogelof, told the <a target="_blank" href="https://www.wsj.com/finance/investing/wall-street-races-to-bring-private-credit-to-the-masses-8a25b624">Wall Street Journal</a>.But he says there is huge potential for that share to grow by over three times. "We anticipate these allocations to rise to 10% or greater in the future," he told the Journal.

Investing giants want to offer retail traders access to a booming sector of financial markets

The residential market shows a positive outlook, with 51% of stakeholders predicting higher sales over the next six months. However, a notable 24% expect stability, while 25% predict a potential decrease, reflecting a balanced yet cautious sentiment, as per a recent <keyword id="19895043" type="General" weightage="20" keywordseo="Knight-Frank" source="keywords" meta.keywordsubtype="org" meta.entityname="Knight Frank" meta.hostid="261" meta.entityid="Knight Frank">Knight Frank</keyword> report. The outlook for residential launches is also positive, with 61% expecting an increase, suggesting continued demand. A more tempered view is held by 20% of respondents who expect stability, and 19% foresee a decrease in launches. The Indian <keyword id="20152263" type="General" weightage="20" keywordseo="real-estate-sector" source="keywords">real estate sector</keyword> continues to reflect a positive outlook for the near future, though with a more cautious approach. In terms of pricing, 63% of stakeholders expect a rise, but 36% anticipate stable prices, and a very small minority predict a decline. G Hari Babu, National President, National Real Estate Development Council (<keyword id="20429653" type="General" weightage="20" keywordseo="naredco" source="keywords">NAREDCO</keyword>), said, "The residential and office markets continue to show notable activity, signaling ongoing growth and opportunity. Developers and other key stakeholders, including banks and financial institutions, are maintaining a positive outlook." He added, "This suggests that while there may be short-term challenges, the sector is well-positioned to adapt and thrive. The continued optimism and activity in the market highlight the sector's ability to sustain its momentum and drive forward, amidst changing conditions." The <keyword id="22822547" type="General" weightage="20" keywordseo="office-leasing-market" source="keywords">office leasing market</keyword> shows signs of strong recovery, with 63% of respondents predicting an increase in leasing activity, driven by positive business sentiments and <keyword id="21313740" type="General" weightage="20" keywordseo="economic-revival" source="keywords">economic revival</keyword>. However, 24% expect stability, and 13% foresee a decline. New office supply also remains a point of interest, with 47% expecting an increase, while 29% anticipate stability, and 24% forecast a decrease. Furthermore, 67% of stakeholders expect office rents to rise, signaling confidence in the market's ongoing growth, even as 27% anticipate stable rents and 7% expect a decrease. The <keyword id="20635920" type="General" weightage="20" keywordseo="future-sentiment-score" source="keywords">Future Sentiment Score</keyword>, which measures stakeholders' outlook over the next six months, saw adjustments across various regions. The North Zone score slightly decreased from 65 in Q1 2024 to 63 in Q2 2024, though it remains firmly optimistic. The South Zone witnessed a more significant drop from 76 to 65, signaling a moderated outlook. In the East Zone, the score fell from 77 to 65, largely influenced by the discontinuation of the 2% stamp duty cut. The West Zone also saw moderation, with the score dipping from 73 to 66, though it too, remains optimistic. The overall Developer Future Sentiment score decreased from 72 to 61, reflecting a more guarded approach. Developers, while cautious, continue to remain optimistic due to strong sales since early 2023. On the other hand, the Non-Developer Future Sentiment core, which includes financial institutions and PE funds, also moderated from 73 to 68. This shift indicates stakeholders' careful consideration of macroeconomic concerns. Optimism in India's broader economic scenario remains strong, with 59% of respondents expecting an improvement, reflecting confidence in the country's economic resilience. However, 24% foresee stability, and 17% predict a decline, underscoring global economic uncertainties. Meanwhile, 51% of respondents anticipate increased funding availability for real estate investments, reflecting continued confidence in the financial sector's support for the real estate market. Shishir Baijal, Chairman and Managing Director of Knight Frank India Pvt Ltd, noted, "As we transition through 2024, a host of factors are playing out globally. The global economic landscape shows resilience despite ongoing challenges. Inflation rates are gradually aligning with central bank targets, enabling a more supportive monetary policy. India, benefiting from stable post-election conditions, remains a strong growth beacon." He added, "Domestic consumption is robust, supported by consumer loans, though there are some signs of growth moderation. Food inflationary pressures persist, but are converging overall towards price stability targets. With a projected GDP growth rate of 7.2% for FY 2025, India's outlook remains positive. An effective monetary policy by the Reserve Bank of India has helped sustain growth with price stability, positioning India as one of the fastest-growing large economies globally." The Current Sentiment score, which reflects stakeholders' view of the market compared to six months ago, moderated from a decadal high of 72 in Q1 2024 to 65 in Q2 2024. This suggests a more measured outlook as stakeholders navigate evolving global economic conditions. Despite the dip, the score remains indicative of optimism. Looking forward, the Future Sentiment index also adjusted from 73 in Q1 2024 to 65 in Q2 2024, signaling a positive yet more conservative outlook for the near term. While macroeconomic uncertainties may dampen enthusiasm, stakeholders continue to show confidence in the sector's resilience and adaptability.

Despite budget provisions, residential housing market will see sales growth, notes recent report by Knight Frank

New Delhi [India], May 20 (ANI): A recent Certified Practising Accountant (CPA) Australia survey has revealed an overwhelming optimism among <keyword id="21735155" type="General" weightage="100" keywordseo="Indian-small-businesses" source="keywords">Indian small businesses</keyword>, with 84 per cent anticipating continued growth in 2024, significantly surpassing the market average of 70 per cent. Despite global <keyword id="20413867" type="General" weightage="20" keywordseo="economic-uncertainties" source="keywords">economic uncertainties</keyword>, 80 per cent of Indian respondents remain confident about the local economy's prospects for 2024, well above the survey average of 65 per cent. This buoyant outlook has been on an upward trajectory since 2022, highlighting the resilience and dynamism of India's small business sector. <keyword id="21735156" type="General" weightage="20" keywordseo="CPA-Australia-survey" source="keywords">CPA Australia survey</keyword> showed a rise in the growth rate of Indian <keyword id="390673" type="General" weightage="20" keywordseo="small-businesses" source="Orion">small businesses</keyword> from 73 per cent in 2022 to 77 per cent in 2023--the highest since 2019. Indian small businesses are riding a wave of optimism and growth, according to <keyword id="21735157" type="General" weightage="20" keywordseo="CPA-Australia" source="keywords" meta.keywordsubtype="org" meta.entityname="CPA Australia" meta.hostid="261" meta.entityid="CPA Australia">CPA Australia</keyword>'s latest annual Asia-Pacific Small Business Survey. The survey reveals that over three-quarters of Indian small businesses reported growth in 2023, surpassing pre-pandemic levels and making India's small business sector one of the most dynamic and fastest-growing in the Asia-Pacific region. Prafulla Chhajed, a CPA member of CPA Australia in India, emphasized the critical role of Micro, Small, and Medium-sized Enterprises (<keyword id="19910977" type="General" weightage="20" keywordseo="MSMEs" source="keywords">MSMEs</keyword>) in driving India's economic success. Chhajed said, "Micro, Small and Medium-sized Enterprises (MSMEs) are making a significant contribution to India's economic success. Not only is India's rapid economic growth and improving business environment boosting their confidence, support from the government ranging from digitalisation to access to funds, is assisting businesses to recover from the pandemic." He further said, "India's small businesses are enthusiastically improving their performance through innovation, adopting technologies, and building connections with overseas markets. 'Good staff' was nominated as the top positive factor that benefited India small business performance in 2023. It explains why Indian respondents have been so willing to add new employees over the past two years". "This year the pace in jobs creation by small businesses is expected to slow, although remain high in comparison to other markets. This is most likely due to a combination of factors including increasing levels of automation and rising labour costs," he added. However, Chhajed cautioned that the pace of job creation might slow down due to rising automation and labor costs, though it will still remain high compared to other markets. The survey highlighted several challenges faced by Indian small businesses, including increasing costs, competition, and cashflow difficulties. Staff and material costs were particularly detrimental in 2023, rising slightly from the previous year. To cope with these expenses and support growth, 68 per cent of small businesses sought external funding last year, though this figure dropped 20 percentage points from 2022. This year, 81 per cent plan to seek finance, despite tougher financing conditions. Only 42 per cent of respondents found it easy to secure funds in 2023, a sharp decline from 69 per cent in 2022. This trend is expected to continue, with just 43 per cent anticipating ease in accessing funds this year, down from 64 per cent previously. "Difficulty in accessing finance is a common challenge for small businesses worldwide. Though government loans like <keyword id="20151906" type="General" weightage="20" keywordseo="pradhan-mantri-mudra-yojana" source="keywords">Pradhan Mantri MUDRA Yojana</keyword> (PMMY) helps to foster entrepreneurship by offering financial support, MSMEs should not solely rely on borrowing to fund their long-term development, particularly in a high-interest rate environment", Chhajed explained. A significant number of Indian small businesses focused on managing costs and cash flow last year. Among the technologies they invested in, accounting software was particularly popular, with 23 per cent adoption. Professional advice was also sought frequently, with 34 per cent consulting accountants and 38 per cent seeking advice from friends and family. "Indian MSMEs are very competitive in many areas such as digitalisation and innovation, now they should focus on cost management and cashflow to increase their financial return. It's wise to use accounting software to control cost and analyse financial performance regularly. Further, financial experts like qualified accountants may provide professional advice to small businesses to manage technical issues like taxation and improve financial performance", Chhajed suggested. Indian small businesses also show a strong inclination towards innovation and global expansion. Leading the 11 surveyed markets, 34 per cent of respondents expect substantial revenue growth from overseas markets this year, significantly higher than the survey average of 19 per cent. Additionally, 44 per cent plan to introduce new products or services, compared to the market average of 29 per cent. Chhajed said, "The Indian government has established good platforms to bolster our MSMEs' global expansion, for example, international trade fairs for MSMEs. He added, "They could leverage these opportunities to connect with overseas customers and promote their novel products globally. Besides, our thriving digital economy also fosters MSMEs' innovation and revolution in the digital era." The survey gathered insights from 4,222 small businesses across 11 Asia-Pacific markets, including 505 respondents from India, providing a comprehensive overview of the region's small business landscape. (ANI)

84% of Indian small businesses anticipate robust growth in 2024: CPA Australia survey

<keyword id="20190045" type="General" weightage="20" keywordseo="Industry-body" source="keywords">Industry body</keyword> <keyword id="21568150" type="General" weightage="20" keywordseo="SME-Chamber-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="SME Chamber of India" meta.hostid="261" meta.entityid="SME Chamber of India">SME Chamber of India</keyword> has urged <keyword id="19956758" type="General" weightage="20" keywordseo="Finance-Minister" source="keywords">Finance Minister</keyword> <keyword id="19916618" type="General" weightage="20" keywordseo="Nirmala-Sitharaman" source="keywords">Nirmala Sitharaman</keyword> to continue the 45-day <keyword id="21233021" type="General" weightage="100" keywordseo="MSME-payment-rule" source="keywords">MSME payment rule</keyword> for <keyword id="20008810" type="General" weightage="20" keywordseo="corporates" source="keywords">corporates</keyword> and other buyers. According to Section 43B(h) of the <keyword id="19936187" type="General" weightage="20" keywordseo="Income-Tax-Act" source="keywords">Income Tax Act</keyword>, introduced through the <keyword id="19955404" type="General" weightage="20" keywordseo="finance" source="keywords">Finance</keyword> Act 2023, if a larger company does not pay an MSME on time -- within 45 days in case of written agreements -- it cannot deduct that expense from its taxable income, leading to potentially higher taxes. The government in last year's Budget added a new clause under Section 43B of the Income Tax Act to address the challenge of delayed payments faced by MSMEs in the country. "We are pursuing not to change the 45-day MSME payment rules imposed by the Department under the pressure of corporates or multinational companies to save the life span of the MSME sector. Section 43B(h) of the Income Tax Act reinforces the importance of timely payments by mandating that companies settle payments to MSME vendors within 45 days to qualify for deductions," SME Chamber said in a statement addressed to Sitharaman. The industry body argued that this provision serves as a powerful incentive for companies to adhere to payment timelines, thereby supporting the financial health of MSMEs. "Many MSMEs are NPA victims of corporates, who are buying from them and not dealing through the TReDs platform. Most of the corporates and multinational companies are forcefully insisting to deregister from the Udyam Portal and insisting not to deal through the TReDs platform," SME Chamber stated. The industry body also urged the finance minister to consider providing Rs 5 crore loans under the "Differential Rate of Interest" scheme for micro and <keyword id="20569966" type="General" weightage="20" keywordseo="small-enterprises" source="keywords">small enterprises</keyword>. It suggested changing the NPA definition from 90 days to 180 days for the MSME sector. The chamber also sought the setting up of a task force to review various issues, hurdles, grievances and difficulties faced by MSMEs for availing credit facilities and the lack of approach by the financial institutions towards enhancement of credit flow to the MSME sector.

Continue 45-day MSME payment rule: Industry body to Finance Minister Nirmala Sitharaman

<ul class="summary-list"><li>Harris has proposed expanding the small business tax credit from $5,000 to $50,000.</li><li>Experts told BI the proposal would shift the timing of deductions and isn't all that pricey.</li></ul>Patricia Oswlad, 55, and her husband have spent years building up their retirement fund. But when Oswald decided to launch a small business in the fall of 2022, the couple liquidated some of their assets to fund the company, throwing their financial planning to the wind.With fewer than five weeks until Election Day, Vice President Kamala Harris is <a target="_blank" class="" href="https://www.businessinsider.com/kamala-harris-small-businesses-tax-breaks-cut-red-tape-2024-9">making a targeted pitch to entrepreneurs</a> like Oswald, who are burdened by startup expenses. She even mentioned a key proposal in her opening answer at the presidential debate: expand the small business tax credit 10-fold, from $5,000 to $50,000.In a pamphlet on her economic plan, dubbed the <a target="_blank" class="" href="https://www.businessinsider.com/what-you-need-to-know-about-kamala-harris-opportunity-economy-2024-9">"Opportunity Economy,"</a> Harris explains that she would let business owners take advantage of the $50,000 tax deduction right away or a few years after launching, to help lower taxes once they start turning a profit. The proposal, <a target="_blank" class="" href="https://www.businessinsider.com/harris-added-policy-website-before-trump-debate-venture-capital-startups-2024-9">like many of her others</a>, would need <a target="_blank" class="" href="https://www.businessinsider.com/kamala-harris-senate-races-ted-cruz-rick-scott-2024-9">congressional</a> approval.Oswald told Business Insider the credit would have been "invaluable" in getting Brisa Systems, which offers powered drying racks, off the ground.<h2 id="7006e4c2-613d-4eb9-8fc4-ad020faacaad">Harris' proposal shifts the tax timeline for entrepreneurs.</h2>Tax experts told BI that enacting the credit would mean a change in timing more than anything else. Under current law, small businesses can deduct up to $5,000 in expenses immediately and must deduct any future expenses against their income over 15 years. Harris' proposal would let entrepreneurs deduct more money quickly.Owners have expenses before even launching their business, and the deduction would help cover those costs.Rhett Buttle, the co-executive director of Small Business Roundtable and a former business advisor for President Joe Biden, told Business Insider that startup costs accumulate in three primary areas: marketing, basic equipment, and hiring.For Oswald, most early costs have been in manufacturing and intellectual property services. Taylor McCleneghan, who launched her product development company, Small Shop LLC, in 2018, named inventory and marketing as the biggest upfront costs. Both women are based in the Chicago area.<div type="image" title="Kamala Harris at a campaign event about small businesses" height="3439" width="5159" msid="113963121" hostid="261" sizebytes="769310"></div>Brett Theodos, a senior fellow at Urban Institute who specializes in small business loans, told BI that entrepreneurs would "love" to be able to deduct more of those expenses right away. Moving up the timeline would, he said, make many feel less strapped for cash from the very outset.And there's another potential upside, according to Garret Watson, a senior policy analyst at the nonpartisan Tax Foundation. Small businesses would likely benefit from getting the deduction more quickly because of inflation, he said.Many entrepreneurs are psyched about the effort. Theodos struggled to think of a reason why they wouldn't want this, and Buttle said that those he works with are overwhelmingly excited about the plan.McCleneghan, of the Small Shop, said having access to a $50,000 tax deduction early on would have allowed her to do better long-term planning. With the expanded tax deduction, Oswald said she might not have had to divest retirement funds or take out lines of credit."Getting money in the hands of entrepreneurs sooner is going to allow them to hire, to get equipment, to get a space, to pay off some debt, to pay themselves," Theodos said. "So it's meaningful to allow them to accelerate the deduction of startup expenses."But while small business owners may jump at the opportunity for more early cash flow, where this money would come from is more unclear. McCleneghan herself acknowledged that the details seem hazy.<h2 id="af50011b-34e9-4f5e-9a3b-b001ea7f148b">Despite the flashy numbers, the proposal likely wouldn't have a significant impact on the federal budget.</h2>Though $50,000 sounds like a big-ticket promise, the experts BI spoke to said Harris' proposal actually wouldn't make a big dent in the federal budget. The Tax Foundation, where Watson works, examined cost estimates from prior expansions and found that the proposal would cost about $24.5 billion over 10 years."Relative to the federal government's budget and spending, it's very small," Watson said. "This $25 billion number is in the context of a tax plan for the Harris campaign that would raise about $5 trillion over 10 years. So you're talking about orders of magnitude more money on the tax hike side."<div type="image" title="Kamala Harris and Mike Johnson during the State of the Union speech" height="4000" width="6000" msid="113963120" hostid="261" sizebytes="522916"></div>Some of the loss, he said, stems from the likelihood that certain entrepreneurs will use the deduction and then go out of business. Since the proposal changes when businesses can deduct rather than how much they deduct, it will cost some money, but not "big money," Theodos said.And the proposal could help spur growth, if it becomes law. According to a study from the <a target="_blank" class="" href="https://www.pewresearch.org/short-reads/2024/04/22/a-look-at-small-businesses-in-the-us/">Pew Research Center</a> published in April 2024, small businesses employ nearly half of the country's private sector employees.Theodos called small businesses "essential" for the US economy, and Buttle said they're a<a target="_blank" class="" href="https://www.businessinsider.com/harris-sec-ftc-khan-gensler-crypto-regulation-biden-warren-2024-9"> crucial source of innovation</a>. But the tax experts said the full potential economic impact of the proposed expansion is still up in the air."The question is, will this significantly contribute to a startup boom or really change the needle there or move the needle there? I think that's a reasonable question. It's up for debate, particularly because this is such a narrow provision," Watson told BI, while noting that giving businesses deductions is generally a good policy.If the policy did spur more development, though, Mary Hansen, an economics professor at American University and co-director of the nonpartisan Institute for Macroeconomic and Policy Analysis, said it would eventually have a net positive impact on government revenue.As of now, Harris' promise is just that — a promise.Should she win the election, Congress would need to pass legislation to turn her expanded tax deduction idea into a reality. Despite the prevailing congressional gridlock, all of the experts BI spoke with said small businesses are a rare point of potential bipartisan agreement. Watson predicted that lawmakers would likely tie the proposal to their actions on the expiring 2017 tax provisions.<div type="image" title="Kamala Harris and Doug Emhoff go shopping to support Small Business Saturday" height="3788" width="5973" msid="113963117" hostid="261" sizebytes="2365956"></div>Should Congress ever pass the expanded tax deduction, all startups and small businesses would access the same amount of money — but the experts told BI that some would feel the impact more than others. Entrepreneurs with less initial cash flow would disproportionately benefit from the change, they said.Buttle said it would help women and people of color who have a harder time accessing capital. The Pew Research study found 61% of small businesses are majority-owned by men and, as of 2021, 85% were majority-white owned."We're talking about community businesses, micro-businesses, businesses where the founder doesn't have as much net worth," Theodos told BI. "Everybody can benefit from $45,000, but the question is, who is that making the critical difference for?"

Kamala Harris' tax plan for small businesses sounds like it will cost a lot of money — it won't 

<ul class="summary-list"><li>It's all but guaranteed that the Federal Reserve will cut interest rates this week.</li><li>It comes after years of aggressive inflation-fighting from the central bank.</li></ul>The time has finally come: Americans are about to find out <a target="_blank" href="https://www.businessinsider.com/interest-rate-cuts-wall-street-how-much-jackson-hole-fed-2024-8">how big of an interest-rate cut</a> they'll be getting this week.On Wednesday, the Federal Open Market Committee will announce its next move on <a target="_blank" href="https://www.businessinsider.com/jobs-unemployment-interest-rates-economy-recession-soft-landing-2024-8">interest rates</a>, and it's all but certain the nation's central bank will cut for the first time in four years. The big question is how much.According to <a target="_blank" href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html">CME FedWatch</a>, which estimates interest rate changes based on market predictions, the size of the rate cut is a coin toss. As of Friday afternoon, there's a 51% chance the Federal Reserve will cut rates by 25 basis points and a 49% chance it'll be an extra-large 50-basis-point cut. The probabilities suggest a near-zero chance that the Fed will hold rates steady."The time has come for policy to adjust," Fed Chair Jerome Powell said during his address at a gathering of central bankers in <a target="_blank" href="https://www.businessinsider.com/interest-rate-cuts-are-coming-federal-reserve-jackson-hole-powell-2024-8">Jackson Hole, Wyoming,</a> last month. "The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks."The <a target="_blank" href="https://www.businessinsider.com/inflation-august-consumer-price-index-federal-reserve-rate-cuts-2024-9">consumer price index</a> inflation data that came out last Wednesday was the last large piece of data before the Fed meeting. With August's core CPI coming in unexpectedly hotter than expected, it was looking likely a 50-basis-point cut wouldn't happen. That's because a larger rate cut makes borrowing cheaper, which tends to drive up spending and fuel price increases.The <a target="_blank" class="" href="https://www.businessinsider.com/unemployment-rate-job-growth-interest-rate-cuts-federal-reserve-recession-2024-9">job market</a> also supports a rate cut this month — the unemployment rate ticked down in August but stayed above its recent lows, and hiring gains have cooled. Lower rates ease pressure on companies' bottom lines, freeing up budgets for hiring.Many economists hope that the long-sought soft landing of getting inflation under control while avoiding a devastating recession could be near. "This rate cut is great news for middle-class families, not only does it underscore the Fed is convinced that inflation is coming under control, it signals the economy has recovered to a faster, sustainable growth trajectory and is ready for further investments in job creation," Michael Madowitz, the former director of macroeconomic policy at the Washington Center for Equitable Growth, said.<h2 id="d213ed81-690b-4194-9569-8ae1349857cf">It'll take time for the cuts to set in</h2>Alena McTier, a Gen Zer, had been looking to replace the car she purchased in 2017 this summer, but she was up against sticker shock. She can't wait for the <a target="_blank" href="https://www.businessinsider.com/personal-finance/banking/when-is-the-next-fed-meeting">Fed to announce rate cuts</a>. She told Business Insider she's been <a target="_blank" href="https://www.businessinsider.com/car-prices-falling-forecast-outlook-new-used-electric-vehicle-market-2024-6">holding on to her car</a> "until a solid decision is made" from the Federal Reserve on interest rates."When they are cut, I am going to actively explore the different rates that are available," McTier, who is looking to buy a used vehicle, told Business Insider in August.It could take a while for McTier to see those lower rates. While some parts of the economy will be immediately impacted, there will still be a lag for relief in some sectors."Given the fact that monetary policy does take time to work its way through the system, it'll be the same to some degree with the rate reductions," Mark Hamrick, senior economic analyst for Bankrate, told Business Insider. He added that prime lending rates will likely be adjusted soon after the decision: "Banks adjust their prime lending rates, the rates reserved for their best customers, and those tend to then be reflected in credit card rates immediately," Hamrick said.Credit card interest rates have been at historic highs — a February <a target="_blank" class="" href="https://www.consumerfinance.gov/about-us/blog/credit-card-interest-rate-margins-at-all-time-high/">report</a> from the Consumer Financial Protection Bureau found that the average annual percentage rate on credit cards has almost doubled over the past decade to 22.8% in 2023. However, the lag means that those hoping to pay off credit cards won't be materially impacted by this month's rate cut — it'll take time for the relief to set in.Rate cuts will also eventually make it cheaper for <a target="_blank" class="" href="https://www.businessinsider.com/recession-outlook-small-business-owner-economy-interest-rate-cuts-2024-9">small businesses</a> to take out loans. When it comes to <a target="_blank" href="https://www.businessinsider.com/how-fed-rate-cut-could-impact-mortgage-rates-homebuyers-2024-9">buying a new house</a> or car, the rate cuts could make things slightly cheaper, but they likely won't have a significant impact on costs in the short term. That's because rate cuts' effects on the housing market are complicated. A rate cut could <a target="_blank" class="" href="https://www.businessinsider.com/buying-home-not-easier-interest-rate-cuts-prices-rent-crisis-2024-8">cause a rush of buyers to enter the market</a> in the short term, driving up prices and competition.Still, some Americans are shaping their finances in anticipation of a rate cut. <a target="_blank" href="https://www.nerdwallet.com/h/data/studies-and-data-analysis#rate-cut-actions">NerdWallet</a> found in a July survey that a majority of Americans reported planning to take financial action once interest rates drop, like buying a home or taking out a loan. Almost a quarter of US adults in the survey said they plan to buy a car, while 15% said this about a home."Regardless of what the Fed decides, if you have credit card debt, your credit card debt is going to remain expensive even if interest rates begin to go down a little bit," Sara Rathner, credit cards expert at NerdWallet, said.How are you shaping your finances in anticipation of an interest-rate cut? Are you planning to make any big purchases or investments? Share your story with these reporters at <a target="_blank" href="mailto:asheffey@businessinsider.com">asheffey@businessinsider.com</a> and <a target="_blank" href="mailto:mhoff@businessinsider.com">mhoff@businessinsider.com</a>.

Welcome to interest-rate cut week: Here's how the Fed's next move will impact everything from home prices to new cars loans

<ul class="summary-list"><li>The SBA expanded its loan programs to support investments in clean energy businesses.</li><li>It will also let lenders apply to extend loan sizes up to $2 million for climate-related projects.</li></ul>The Small Business Administration is <a target="_blank" class="" href="https://www.businessinsider.com/sba-loans-small-business-lending-rules-change-2023-8">expanding its loan programs</a> to support investments in <a target="_blank" class="" href="https://www.businessinsider.com/us-renewable-energy-transition-solar-electric-vehicles-hit-records-2024-2">clean energy</a> and <a target="_blank" class="" href="https://www.businessinsider.com/biden-administration-wants-boost-clean-energy-pay-through-tax-credits-2024-6">climate-friendly businesses</a>.The SBA announced on July 22 that it is increasing the maximum loan available through its Community Advantage program — which provides financing to entrepreneurs in underserved markets, like low-income communities — with increased flexibility for <a target="_blank" class="" href="https://www.businessinsider.com/how-the-climate-crisis-can-change-make-economy-better-resilient-2023-9">climate-focused projects</a>.The SBA will increase the maximum loan amount for active lenders to $500,000 from $350,000. It is also creating an application process for lenders to expand their loan size up to $2 million for climate-focused projects or $1 million for general projects.Lastly, the SBA will create an application for Community Advantage lenders to expand their geographic reach.The changes are part of the SBA's green lender initiative, which aims to enroll more climate-focused lenders in SBA programs and raise capital <a target="_blank" class="" href="https://www.businessinsider.com/jobs-climate-manufacturing-work-best-places-georgia-carolinas-2024-1">to support sustainable businesses</a>.Isabel Guzman, the administrator of the SBA, said in a statement that the green lender initiative aims to support "mission-driven climate lenders" and help fund "the small business clean energy transition.""Small businesses and homes account for more than one-third of US emissions, so it is vital that they are part of the solution," Guzman said.SBA loans, provided through banks or other financial institutions, help entrepreneurs raise capital.The SBA offers three main types of loans:<ul><li>Microloans range from $500 to $50,000 and are offered through nonprofit community-based lenders.</li><li>504 loans provide financing up to $5.5 million for major fixed assets like real estate and are provided through certified development companies — nonprofits regulated by the SBA to provide loans.</li><li>7(a) loans provide long-term financing up to $5 million for general small business investments and are offered through most banks. The SBA guarantees 85% of 7(a) loans up to $150,000 and 75% on loans larger than that amount.</li></ul>Community Advantage — the program being expanded by the green lender initiative — is a segment of the 7(a) loan program."SBA loans have been assisting small businesses and the lenders who support them for decades," Katie Frost, associate administrator for the SBA Office of Capital Access — which helps businesses find lenders — said in a <a target="_blank" class="" href="https://www.sba.gov/article/2024/07/22/biden-harris-administration-opens-sba-loan-programs-new-green-lenders-help-small-businesses-meet">statement</a>. "The SBA is excited to welcome green banks and similar institutions into SBA lending, to capitalize on these benefits and broaden their support to more American small businesses."<h2 id="dd41d010-97e4-4f2c-8584-f56dcf925fb5">SBA focuses on climate-friendly businesses</h2>The expansion of the SBA's loan programs comes after several years of record entrepreneurship. Under the Biden administration, there have been <a target="_blank" class="" href="https://www.whitehouse.gov/briefing-room/statements-releases/2024/06/12/statement-from-president-joe-biden-on-a-record-18-million-small-business-applications/#:~:text=Today%2C%20my%20Administration%20announced%20over,powered%20our%20economic%20comeback%20continues">18 million small business</a> applications. Additionally, in past years, the SBA has <a target="_blank" class="" href="https://www.businessinsider.com/sba-loans-small-business-lending-rules-change-2023-8">revised its loan requirements</a> to expand outreach to underserved communities.The SBA's focus on climate-friendly businesses is part of the Biden administration's green energy goals, which include a carbon pollution-free power sector by 2035 and a <a target="_blank" class="" href="https://www.whitehouse.gov/briefing-room/statements-releases/2023/04/20/fact-sheet-president-biden-to-catalyze-global-climate-action-through-the-major-economies-forum-on-energy-and-climate/#:~:text=Putting%20the%20Power%20Sector%20on%20a%20Path%20to%20Net%20Zero%20Emissions&amp;text=President%20Biden%20has%20set%20an,by%20no%20later%20than%202050.">zero-emission economy</a> by 2050.The 2022 Inflation Reduction Act — the largest <a target="_blank" class="" href="https://www.businessinsider.com/house-passes-inflation-reduction-act-sending-it-to-biden-2022-8">climate-focused federal package in US history</a> — approved spending on green energy projects, including authorizing the $27 billion <a target="_blank" class="" href="https://www.epa.gov/greenhouse-gas-reduction-fund">Greenhouse Gas Reduction Fund</a> through the Environmental Protection Agency.The green lender initiative will help small businesses tap into this fund, according to the SBA."The green lending initiative will help advance EPA's and SBA's shared goals of ensuring that communities and small businesses have access to the capital they need to support and benefit from a cleaner and more sustainable economy," Michael S. Regan, EPA administrator, said in a statement.Are you a small-business owner or entrepreneur scaling a startup right now? This reporter wants to hear from you. Please reach out at <a target="_blank" class="" href="mailto:jtowfighi@businessinsider.com">jtowfighi@businessinsider.com</a>

The Biden administration is giving entrepreneurs a shot at loans up to $2 million for climate-focused projects

New Delhi, The government on Monday informed Parliament that <keyword id="6355629" type="General" weightage="20" keywordseo="Google" source="Orion">Google</keyword> has suspended or removed over 2,500 fraudulent <keyword id="6095737" type="General" weightage="20" keywordseo="loan-apps" source="Orion">loan apps</keyword> from its Play Store between April 2021 and July 2022. The government is constantly engaged with the Reserve Bank of India (RBI) and other regulators and stakeholders concerned to control fraudulent loan apps, Finance Minister Nirmala Sitharaman said in a written reply to the Lok Sabha. The matter is also regularly discussed and monitored in the meetings of the Financial Stability and Development Council (FSDC), an inter-regulatory forum under the chairpersonship of the Finance Minister. The objective is to remain proactive, maintain cyber security preparedness with constant vigilance, and take appropriate and timely action to mitigate any such vulnerabilities in the Indian financial system, she said. As part of steps taken to control fraudulent loan apps, she said, the RBI has shared a 'whitelist' of legal apps with the government of India, and this list was shared by the Ministry of Electronics and Information Technology (Meity) with Google, whose app store is the primary source of distribution of digital lending apps. Google has updated its policy regarding enforcement of loan lending apps on the Play Store and has also deployed additional policy requirements with strict enforcement actions for lending apps in India, she added. As per their revised policy, only those apps are allowed on the Play Store which are published by Regulated Entities (REs) or those working in partnership with REs. "Between April 2021 and July 2022, Google also reviewed approximately 3,500 to 4,000 loan lending apps and suspended or removed over 2,500 fraudulent loan apps from its Play Store," she said. The Indian Cyber Crime Coordination Centre (I4C), Ministry of Home Affairs (MHA), has been regularly analysing the digital lending apps proactively. Based on its analysis and complaints reported on the National Cyber Crime Reporting Portal, the I4C team analyses apps on various parameters and reports to Meity apps found suspicious for blocking, she said. To spread awareness against cybercrimes and to safeguard interests of citizens, several steps have been taken by the government, the RBI, and banks, she said. The RBI has formulated conducting of electronic-Banking Awareness And Training (e-BAAT) which has largely focussed on awareness about fraud and risk mitigation, while a Nation-wide Intensive Awareness Programme (NIAP) was carried out in collaboration with the REs. In a separate response, Sitharaman said more than 44.46 crore loans amounting to Rs 26.12 lakh crore (as of November 24, 2023) have been sanctioned to the borrowers under the Pradhan Mantri Mudra Yojana (PMMY) since its inception. Under PMMY, collateral-free institutional credit up to Rs 10 lakh is provided by Member Lending Institutions (MLIs), i.e., Scheduled Commercial Banks (SCBs), Regional Rural Banks (RRBs), Non-Banking Financial Companies (NBFCs), and Micro Finance Institutions (MFIs). Any individual who is otherwise eligible to take a loan and has a business plan for a small business enterprise can avail of a loan under the scheme. Loans can be availed for income-generating activities in the manufacturing, trading, and services sectors, and also for activities allied to agriculture, under three categories, -- Shishu (loans up to Rs 50,000), Kishor (loans above Rs 50,000 and up to Rs 5 lakh) and Tarun (loans above Rs 5 lakh and up to Rs 10 lakh).

You Searched For "small loans sector" and got 11 results

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Simply Put: Is the lending party over? The dangerous tango of Indian banks with microfinance and unsecured loans

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Despite budget provisions, residential housing market will see sales growth, notes recent report by Knight Frank

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84% of Indian small businesses anticipate robust growth in 2024: CPA Australia survey

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Continue 45-day MSME payment rule: Industry body to Finance Minister Nirmala Sitharaman

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Kamala Harris' tax plan for small businesses sounds like it will cost a lot of money — it won't

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Welcome to interest-rate cut week: Here's how the Fed's next move will impact everything from home prices to new cars loans

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Google has removed 2,500 fraudulent loan apps from its Play Store, says FM

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