MSME sector struggling post demonetization loan defaulters double: RBI

MSME sector struggling post demonetization loan defaulters double: RBI
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While the whole economy seemed to decline with imposed demonetization and GST, Micro, Small and Medium Enterprises (MSME) are reported to have doubled their loan default margins according to RBI’s latest figures.

According to RBI, the loan defaulters margin has doubled from Rs 8,249 crore by March 2017 to Rs 16,118 crore by March 2018 whereas the margins for micro and small units are reported to have increased by 6.72 percent that is Rs. 10,49,796 in March 2018 against last year’s recorded figure Rs 9,83,655 crores, newsworldindia reported.

Among the total loan defaulters, the public sector banks account for most loan defaulters which had a share of 65.32 percent in outstanding loans to small units, down from 66.61 percent in the previous year.

In India, the MSME sector’s share constitutes an overall 30 percent of India’s GDP having a vast network of over 63 million unit with 111 million employees.

Apart from this, the MSME sector also accounts for 45 percent of manufacturing output and constituting 40 percent of total exports to other countries.