MSMEs’ Ease of Doing Business: The Retailers Association of India (RAI) has made many representations to various ministries over the last three years, including to the Honourable MSME Minister Shri Nitin Gadkari, to restore their status as Micro and Small Enterprises.
After 2017, retail trade has not been listed as a micro or small business. The Micro, Small and Medium Enterprises Development Act, 2008 does not apply to organisations that do not manufacture or provide services, according to a Government Gazette notification dated June 27, 2017. As a result, they are unable to receive an Udyog Aadhaar Memorandum (which is called MSME registration). This involves companies that are connected to one another.
According to RAI’s remark, the reasoning was that retailing does not come under the priority sector. As a result, loans to SMEs are classified as priority sector lending. The aim of primary sector lending is to encourage the growth of agricultural and labor-intensive businesses in the economy, so loans are available at low interest rates. “Retailers are forced to borrow at a higher rate or from informal financial outlets as a result of the loss of MSME status,” according to the statement.
“Retailers in India should be made competitive,” said Kumar Rajagopalan, CEO of Retailers Association of India (RAI). They’ll need all the help they can get from the government to accomplish this. Recognizing millions of small and medium-sized companies as MSME would provide them with much-needed support and funding options.”