Reserve Bank of India has given great relief to the small traders to repay loans. So far, the Government has extended the deadline to repay the loans, giving major relief to the MSME, which is facing the coffin and GST's beating. Now he can repay his loan in 6 months instead of 3 months. However, the benefit of this discount will be able to pick up the same businessmen who have registered with GST.
Time limit for repaying loan
Banks and NBFC loan accounts are considered non-performing assets (NPAs) when they do not pay loans for 90 days and 120 days respectively. The government has extended this limit to 180 business days for the small businessmen. That is, the traders who have not paid the installment loan since September 1, 2017. They will not be considered NPAs. There will also be businessmen who have not paid the installment loan from 1st September 2017 to 31 January 2018. They will not come in the NPA category. If the MSME does not repay the loan of the bank or NBFC for 180 days, then they will not be called defaulter. Their loan will be treated as valid.
Cache of cash after the GST arrives
After registration of GST, small businesses have not received any refunds due to the problems of cash flows and funds. Due to this, he is unable to repay his loan and NBFCs on time. Government has given a concession under the Micro, Small and Medium Enterprise Development (MSMED) Act, 2006 to help such MSME Unit.
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