Annual Capacity Building Plan (ACBP) for MSME and DFS Released

Union Minister of State for Micro Small and Medium Enterprises (MSME), Bhanu Pratap Singh Verma, unveiled the Annual Capacity Building Plan (ACBP) for the Ministry of MSME and the Department of Financial Services (DFS) on Wednesday, January 17th, 2024. This strategic initiative aims to bolster the capabilities of the MSME sector, aligning with the Prime Minister’s vision for a USD 5 trillion economy.

Objective of ACBP

The ACBP focuses on creating a comprehensive training plan tailored to each role, identifying organizational needs, and fostering a learning-centric culture. The overarching goal is to augment the contribution of MSMEs to GDP and exports, promote digitalization within the sector, and facilitate data-driven analyses for MSME-related schemes. Additionally, a dedicated Capacity Building Unit (CBU) will be established in each Ministry to manage capacity building interventions efficiently.

Minister’s Address

During the capacity-building workshop, Minister Verma emphasized the government’s commitment to strengthening and developing the MSME sector, evident in the threefold increase in the Ministry of MSME’s budget over the last decade. He acknowledged the growth impediment faced by MSMEs due to constrained access to formal credit, citing a credit gap of INR 25 trillion and an overall debt demand of nearly INR 70 trillion from MSMEs.

Recommendations for Enhancing Credit Access

Key recommendations from the workshop included setting timelines for the registration of Central Public Sector Enterprises (CPSEs) and companies with a turnover of INR 500 crore and above on the TReDS portal. The need for tracking CPSE procurement from MSMEs and transactions through TReDS, along with standardizing assessment criteria by credit bureaus, was emphasized.

Additional Suggestions

The workshop proposed exempting Internal Credit Rating by banks up to INR 1 crore for the Stand-Up India scheme, providing additional input credit to incentivize invoice settlement through TReDS, simplifying procedural requirements for e-commerce exports by MSMEs, and establishing a One Stop Portal for cross-border e-commerce information dissemination.

Joint Workshop and Attendee

The workshop, jointly organized by the Ministry of MSME and the Capacity Building Commission at Kaushal Bhawan, New Delhi, showcased best practices in MSMEs’ access to credit. Representatives from MSME associations, industrial bodies, and banks attended, facilitating the exchange of insights on government policies and banking Standard Operating Procedures (SOPs) related to credit access for MSMEs.

This Annual Capacity Building Plan sets a significant milestone in empowering MSMEs, aligning with broader economic goals and fostering a resilient and dynamic small business ecosystem.

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