Anuja Bapat, ISS: Deputy Director General, MSME

Being a woman yourself, you must have met many female entrepreneurs in rural areas. India’s main artifacts, handloom, handicrafts, etc. are procured from the rural areas which is then further sold through e-commerce and exported. Female entrepreneurs at times go through financial as well as emotional distress. To stay connected with arts, one has to have a subtle mind. In this particularly what draw backs have you witnessed?

Women are naturally enterprising. When we talk about entrepreneur, an entrepreneur is the one who takes risk. And if you look at a woman she always takes risk. In our societal context, even if she has to study, she might have to struggle and in fact struggle more than her male counterpart. When she gets married she goes into a completely different environment. She essentially reinvents herself at every point, when she does a job she has to prove more because she has to make sure that people understands that she is committed and at the same point she is not missing out on her other responsibilities. She is a natural risk taker and she is also a natural saver. In the sense we always talk about financial prudence, if you see right from the very begining our grandmothers and great grandmothers they were always saving. Even if their husband was earning a meagre they always had something saved in their purses, inner pockets, etc. for the reason that it would come into use in future, emergency, distress, etc. So, entrepreneurship is a natural instinct within women. And despite that the societal arrangements actually pulled them down. Women always have to choose between ‘either’ and ‘or’. They can either be an entrepreneur or can be a good wife, they can either be a good daughter or can be a good doctor. So, that struggle they have to go through a lot. If a man succeeds everybody is happy but if a woman succeeds it's difficult for everybody to be happy. Some are happy and some are not. But when a man fails which is very natural in any enterprising activity everybody is there to support him. But when a woman fails, everybody is ready to put a blame on her, saying that “See we told you that you will not be able to manage everything”. So she has to constantly gear up to this stress also that I cannot fail. A man has a freedom to fail, woman does not have a freedom to fail or a lesser freedom to fail. These are good examples coming up and lot of women are coming up infact but these are instrinsic differences between a man and a woman which continues. Again from MSME side we talk about loans. We have exprienced that again the society has taught us like that. We are very self dependent people we try to do everything ourselves. So, even if she is doing an entrepreneurial activity, the first things is that to try to accumulate money or fund from home. So she will put her jewellery on collateral. She will not go out and seek formal credit which a man does more. And then, the response is also in the same coin. I think that is where there is an intrinsic difference between the way society response to her and the way she has conditioned herself to such stresses.

Despite of all these comparisons happening with her, she is a born leader because she always tries. She also does not blame anyone because she also knows that all these talk will follow her. But if she is focused and do not accept failure, She can carry ahead.

Yes, her resilience is far more strong and its a natural resilience. All of us go through child bearing that’s a resilience we are inbuilt with. All of us go through a lot of pain, physical, mental and we are used to that. That’s an internal part of our personality. We are more suited to do entrepreneurial activity because we have a resilience which is very much required.

The MSME is generally product oriented. How can a performing artiste if they have an enterprise like registered Society, Company, etc. how can they be benefited from MSME?

MSME can be anybody. When we talk about a performer he is not an enterprise because he is a performer but the activities around that performer can be entrepreneurial activities. When we talk about MSME in India today, we mean UDYAM registration. It is a centralised registration system and an easy National Industrial Classification Code (NIC). Group 90 is for arts and performing arts under which various categories are there for writers, painters, sculptors, movie makers, performers. You can have your own performing arts institute and under that depending on what you are doing, you can register yourself as a proprietorship, company, cooperative, society, etc. and then if you believe despite being a performer you want a place to train students, appoint musicians or fee collector or an administrator and develop your institute and organise concerts than this becomes an entire setup. And now this is an MSME. You can register under UDYAM for which you need a PAN number preferably company name, ITR filler, declaring your turnover, etc. and hence you are declared as micro enterprise. And then you can take advantage of the schemes that are available run by the ministry. So primarily for an artistes, the collateral free Credit Guarantee Fund Trust (CGFT) scheme is there wherein for a micro or small industry one can take loan up to 10 crore, wherein 75% of the loan is guaranteed by the Credit Guarantee Fund Trust (CGFT). Suppose one is not able to pay back, so in that case the CGFT kicks in. If you have taken 2 crores loan you paid upto 1 crore but for some reason you are unable to pay back the rest of the amount, and if your loan was covered under the CGFT scheme then 75% of the total amount would be paid by the CGFT. How does this help? The bank do not hesitate to give you the loan even if they realise that you do not have an immediate capacity to take up so much of loan. Because without CGFT the bank might have looked up to your CIBIL score or collateral. Even if the CIBIL score is poor, here they are compensate on this fact that you are covered under the CGFT, which originally you have to pay back but just in case if you cannot then the 75% CGFT is there for you and if you are a woman then this CGFT is 90%. The CGFT in noway allows you to default but just in case the loan should not get stopped.

Many artistes go through financial struggle. A production team requires minimum of 10 to 15 lakhs to establish and present an artistic production on stage wherein they incur for rehearsals, costumes and stage sets, music recordings, artistes’ remuneration, hall bookings and other logistics. How can such a production be launched under MSME?

In the same manner. When you are MSME all these loan facilities will be available for you. There’s also Mudra which is collateral free for small loans upto 20 lakhs which is done through banks wherein CIBIL will be counted. As because banks are in a business of giving loans, so they have to be cautious towards it that their money should come back. But these are done case to case. I have not specifically seen such case where artistes has such plans, we’ll definitely see the possibilities. We have officers who can guide on such new ideas and see how we can help it out. We also have some banks whom we can ask how to do it?

The artistes require to understand to establish their art as a business and an enterprise wherein they can appoint artistes on salary. We need to module this as an industry and investment and then earn profit on a regular basis.

Yes. This needs to be moduled as a service provider. Wherein income is generated regularly not once or twice in a year. If such plan has long gaps, then even the banks would not find reason to trust and lend money. An artistic company may also sponsor events and outsource it to various artiste groups or performers. Hence it becomes a service provider. I may a dancer or may not be a dancer but I know 5 people on my board, two of them are Kathak dancers, one is Odissi another one is Chhau dancer and one is Sattriya and with them I have a collaboration wherein every artiste is telling me that next year he/she giving me somebody in all 10 programs. And these 10 programs may have 30 shows, so this is my business now. And then I register as an MSME who is working with you and then this company will raise money and it is like an event management company who will have all the artistes on board who will be working in collaboration for whichever way they want to. Now this company is organising these programs, the profit is coming to them and so whatever dealing they have, it's up to them. Hence, in my MSME account that will be reflected and it becomes an income generating concept. They may later have online courses with videos, so all these can become the business of this company wherein the artistes are involved.

We have witnessed many youngsters coming up with the e-commerce concept through small or big enterprises. Give some light on it.

You may have access to this CGFT or Priority Sector Lending (PSL) which means banks are mandated to give certain percentage of their loans to MSME only. So every bank whatever is their credit portfolio, suppose one bank yearly take 100 crores loan, from there it has to lend 15 crores to MSME. This is a mandate. So if you are a MSME, then the bank will give you loan because they are also achieving their loan giving target. Moreover, in the PSL if you have CGFT then it becomes easy to avail. Being a MSME when you visit bank offering that in a year you want to present this many productions and you are seeking about 50 lakhs loan. The bank will see your business proposal and will see if you can avail it. If you can avail less then like around 30 lakhs, as per your capacity, then the bank will offer accordingly. And if you want to involve CGFT then definitely without collateral the bank might ask for more interest, suppose regular rate of interest is 17% but you are offered 21% without collateral. So this 21% rate of interest also has an upper limit from MSME. We do not offer anything above our upper limit. That you want to avail CGFT is informed by the bank to MSME, they have their own process. Main benefit of the CGFT is that you do not have to give collateral even if your CIBIL is good. Hence, you got fund for your production. Last year in this way we have given last year almost 3 Lakh Crore loans. So it's happening! Even if you do not have collateral, still you can avail loan.

Ministry of MSME do not go to individual MSME and work with them. We have certain schemes of MSME. First register under UDYAM to get recognition. Then we see that some MSME faces certain financial challenges so there’s the CGFT scheme, then we have Equity Investment Scheme, wherein there is a mechanism that equity infusion can be done into the MSME, then we have PMEGP Scheme (Prime Minister’s Employment Generation Program) where if somebody wants to start an enterprise then we give a credit subsidy where upfront of your loan of 50 lakhs we pay 15% of the interest payment and not the loan payment. So, this PMEGP Scheme has been a very successful scheme over the years. With this, yearly we start around 85,000 - 90,000 new enterprises.

From which part of India you have seen more female entrepreneurs?

Its different. I cannot say about a particular part. We have 2 parts of UDYAM registration. One is the regular MSME established. We also have seen tiny enterprises which do not have GST registration, PAN sometimes, so in such women are overwhelmingly in very high numbers like close to 70%. Overall UDYAM registration are close to 39% are women. We have a PM Vishwakarma Scheme where basket makers, textile tailor, these are more of women from both rural and urban areas. UDYAM does not distinguish rural or urban, we are a PAN based registration, a PAN registered in urban area can have its industry in the rural area. But, we have more service sector and less manufacturing and a lot of trading. We also have a procurement policy in which the government will procure a minimum of 4% of all its purchase on GEM from women.

How are all these are merged with export concept?

We have Procurement and Marketing Support Scheme. Here we are working on 2 things. Whenever there is a domestic fair, for example trade fairs in Dilli Haat, International Trade Fairs, or different industrial fairs across different cities where Ministry of MSME helps to put up stalls by giving space, to-fro travel along with carrying the goods. The space is provided bt the Ministry of MSME and across the country we organise 250 such events. Similarly for international component also we help. We have a budget and within it whatever we can support, we support.