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FIDC urges MSME minister to include wholesale & retail trade in MSME definition

The Finance Industry Development Council (FIDC) has requested the MSME Minister Nitin Gadkari to include wholesale and retail trade in the list of activities allowed for registration as MSME.

In this regard, FIDC, an industry body of NBFCs body on Friday, wrote a letter to the minister and also requested him to make consequent changes to the ‘Udyam’ portal.

FIDC informed the minister that retail and wholesale traders who contribute significantly to the country’s economy and are integral part of the business community have been excluded from the definition of MSMEs.

“Traders constitute around 35 per cent of total MSMEs in the country and are thus not eligible for liquidity support from the banking system and extension of priority sector benefits much needed for them,” the letter read.

''We therefore request you to include wholesale and retail trade in the list of activities allowed for registration as MSME," it added.

It further urged the minister that all claims filed during FY21 (especially during March 24, 2021 to March 31, 2021) but not processed, be treated as claims for FY21 as a one-time exception, otherwise this will be a huge financial loss to banks and NBFCs.

FIDC also suggested that NBFCs should be covered under Interest Subvention Scheme for MSMEs, so that they can pass on the subvention credit pertaining to FY20-21 to its MSME customers.

“We also request that the Interest Subvention Scheme be relaunched and be extended to both MSME and Retail and Wholesale traders,” it said.