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Regular repayment of loans to be incentivized
Scheme will help small businesses brace the disruption caused due to COVID-19

Union Cabinet chaired by Prime Minister Shri Narendra Modi today approved approved a scheme for interest subvention of 2% for a period of 12 months, to all Shishu loan accounts under Pradhan Mantri Mudra Yojana (PMMY) to eligible borrowers.

The scheme will be extended to loans which meet the following criteria - outstanding as on 31st March, 2020; and not in Non-Performing Asset (NPA) category, as per Reserve Bank of India (RBI) guidelines, on 31st March 2020 and during the period of operation of the Scheme.

The interest subvention would be payable for the months in which the accounts are not in NPA category including for the months that the account becomes a performing asset again, after turning NPA. The scheme will incentivize people who will make regular repayments of loans.

The estimated cost of the Scheme would be approximately Rs. 1,542 crore which would be provided by the Government of India.

Background

This Scheme is for implementation of one of the measures relating to MSMEs, announced under the Atma Nirbhar Bharat Abhiyan. Under PMMY, loans for income generating activities up to Rs. 50,000 are termed as Shishu loans. PMMY loans are extended by Member Lending Institutions viz. Scheduled Commercial Banks, Non Banking Finance Companies and Micro Financial Institutions, registered with Mudra Ltd.

The ongoing COVID-19 crisis and the consequent lockdown has led to severe disruption of business for micro and small enterprises which are funded through Shishu Mudra loans. Small businesses typically function on thin operating margins, and the current lockdown has had a severe impact on their cash flows, jeopardizing their ability to service their loans. This could lead to default in repayment and have a resultant impact on access to institutional credit in future.

As on 31st March 2020, about 9.37 crore loan accounts under the Shishu category of PMMY with a total loan amount of about Rs 1.62 Lakh crore, were outstanding.

Implementation strategy

The Scheme will be implemented through the Small Industries Development Bank of India (SIDBI) and will be in operation for 12 months.

For borrowers, who have been allowed a moratorium by their respective lenders, as permitted by RBI under the ‘COVID 19 Regulatory Package’, the Scheme would commence post completion of the moratorium period till a period of 12 months i.e. from September 01, 2020 till August 31, 2021. For other borrowers, the scheme would commence w.e.f. June 01, 2020 till May 31, 2021.

Major Impact

The Scheme has been formulated as a specific response to an unprecedented situation and aims to alleviate financial stress for borrowers at the ‘bottom of the pyramid’ by reducing their cost of credit. The Scheme is expected to provide much needed relief to the sector, thereby enabling small businesses to continue functioning without laying off employees due to lack of funds.

By supporting small businesses to continue functioning during these times of crisis, the Scheme is also expected to have a positive impact on the economy and support its revival, which is necessary for employment generation in future.

 

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Ayushman Bharat Digital Mission will create a seamless online platform that will enable interoperability within the digital health ecosystem
There is no such big connected infrastructure anywhere in the world, says the PM referring to JAM trinity
“Digital infrastructure is taking everything from ‘Ration to Prashasan’ to the common Indian in a fast and transparent manner”
“There has also been an unprecedented expansion of telemedicine”
“Ayushman Bharat-PMJAY has addressed a key headache in the lives of the poor. So far more than 2 crore countrymen have availed the facility of free treatment under this scheme, half of which are women”
“Ayushman Bharat – Digital Mission, will now connect the digital health solutions of hospitals across the country with each other”
“Healthcare solutions brought by the Government are a big investment in the present and future of the country”
“ When our health infrastructure is integrated, strengthened, it also improves the tourism sector

Prime Minister Shri Narendra Modi today launched the Ayushman Bharat Digital Mission through a video conference.

Speaking on the occasion, the Prime Minister said that the campaign of strengthening health facilities that have been going for the last seven years is entering a new phase today. “Today we are launching a mission that has the potential of bringing a revolutionary change in India’s health facilities”, said the Prime Minister.

The Prime Minister underlined the fact that with 130 crore Aadhaar numbers, 118 crore mobile subscribers, about 80 crore internet users, about 43 crore Jan Dhan bank accounts, there is no such big connected infrastructure anywhere in the world. This digital infrastructure is bringing everything from ration to administration (Ration to Prashasan) to the common Indian in a fast and transparent manner. “The way technology is being deployed in governance reforms today is unprecedented”, said the Prime Minister.

The Prime Minister remarked that the Arogya Setu app helped a lot in preventing the spread of corona infection. He lauded Co-WIN for its role in making India achieve a record administration of about 90 crore vaccine doses today, under the free vaccine campaign.

Continuing with the theme of the use of technology in health, the Prime Minister said that there has also been an unprecedented expansion of telemedicine during the Corona period, so far about 125 crores, remote consultations have been completed through e-Sanjeevani. This facility is connecting thousands of countrymen living in far-flung parts of the country every day with doctors of big hospitals of cities while sitting at home, said the Prime Minister.

The Prime Minister remarked that Ayushman Bharat-PMJAY has addressed a key headache in the lives of the poor. So far more than 2 crore countrymen have availed the facility of free treatment under this scheme, half of which are women. The Prime Minister emphasized that diseases are one of the key reasons to push families into the vicious cycle of poverty and women of the families are the worst sufferers as they always relegate their health issues to the background. Shri Modi said that he has made it a point to personally meet some beneficiaries of Ayushman and he has experienced the benefits of the scheme during the interactions. He said, “these healthcare solutions are a big investment in the present and future of the country.”

The Prime Minister said Ayushman Bharat – Digital Mission, will now connect the digital health solutions of hospitals across the country with each other. The Mission will not only make the processes of hospitals simplified but also will increase ease of living, he added. Under this, every citizen will now get a digital health ID and their health record will be digitally protected.

The Prime Minister informed that India is working on a health model that is holistic and inclusive. A model which stresses preventive healthcare and, in case of disease, easy, affordable and accessible treatment. He also discussed unprecedented reforms in health education and said a much larger number of doctors and par medical manpower is being created in India now as compared to 7-8 years ago. A comprehensive network of AIIMS and other modern health institutions is being established in the country and work on establishing one medical college in every three Lok Sabha constituencies is going on. He also talked about strengthening health facilities in villages and informed that in the villages, primary health centre networks and wellness centres are being strengthened. More than 80 thousand such centres have already been operationalized, said the Prime Minister.

Noting that today's program is being organized on World Tourism Day, the Prime Minister remarked that health has a very strong relationship with tourism. Because when our health infrastructure is integrated, strengthened, it also improves the tourism sector.