Credit and Finance for MSMEs: To help MSMEs that suffered from severe liquidity challenges, Finance Minister Nirmala Sitharaman launched the “Vivad se Vishwas-I” scheme during the Budget 2023-24. Under the scheme, the government had declared that it would refund 95 per cent of the forfeited amount related to bid security or performance security to MSMEs for their government contracts.
Credit and Finance for MSMEs: The Finance Ministry has extended the deadline by a month till July 31 for MSMEs to submit claims of forfeited bid security for government contracts during the Covid-19 period, said the report by PTI.
This step allows MSMEs one more month to claim a refund for bid security and liquidated damages that were forfeited by government departments and public sector enterprises.
To help MSMEs that suffered from severe liquidity challenges, Finance Minister Nirmala Sitharaman launched the “Vivad se Vishwas-I” scheme during the Budget 2023-24. Under the scheme, the government had declared that it would refund 95 per cent of the forfeited amount related to bid security or performance security to MSMEs for their government contracts.
The scheme also provides some additional provisions to the MSMEs which got debarred due to their inability to execute government contracts during the Covid-19 period till March 31, 2022.
The relief is applicable to all government contracts for procurement of goods and services, initiated by any ministry/department/attached or subordinate office/ autonomous body/Central Public Sector Enterprise (CPSE)/Public Sector Financial Institution etc., with MSMEs.
MSMEs can submit their claims through the dedicated webpage on the Government e-Marketplace (GeM), which is also responsible for the scheme’s implementation and claims processing.
During the Budget speech, Sitharaman also announced that a voluntary settlement scheme with standardised terms would be introduced under the Vivad Se Vishwas scheme to settle contractual disputes of government and government undertakings, wherein the arbitral award is under challenge in a court. It was to be done by offering graded settlement terms depending on the pendency level of the dispute.
