Executive Summary:
This document from the Reserve Bank of India (RBI) announces modifications to the operational guidelines of the Interest Subvention Scheme for MSMEs. These changes include revisions to the submission of auditor certificates, acceptance of claims, Udyog Aadhar Number (UAN) requirements, and eligibility of trading activities. Banks are instructed to submit claims to SIDBI using the revised format (Annex I).
Key Points / Main Content:
Auditor Certificate Submission:
* Statutory auditor certificates must be submitted by June 30, 2020.
* Claims can be settled based on internal concurrent auditor certificates until the statutory auditor certificate is submitted.
Claim Acceptance:
* Eligible institutions can submit claims in multiple lots for a given half-year.
Udyog Aadhar Number (UAN) Requirement:
* The UAN is not required for units eligible for GST.
* Units not required to obtain GST may submit either their Income Tax Permanent Account Number (PAN) or have their loan account categorized as MSME by the concerned bank.
Trading Activity Eligibility:
* Trading activities are now eligible for interest subvention, even without a UAN.
Revised Certificate Format:
* The format of the Certificate for claiming Subsidy (Annex I) has been revised to include trading activities.
* Banks must submit claims to SIDBI using the revised format.
Impact Analysis:
Scheduled Commercial Banks, including Regional Rural Banks:
*Impact:* Affected by changes in operational guidelines for the Interest Subvention Scheme for MSMEs, including revised submission requirements, eligibility criteria, and certificate format.
*Action Required:* Apprise branches and controlling offices of the changes, implement the revised guidelines, and submit claims to SIDBI using the new certificate format (Annex I).
MSMEs:
*Impact:* Affected by relaxed UAN requirements and the inclusion of trading activities for interest subvention.
*Action Required:* Ensure compliance with the updated eligibility criteria, including providing GST details, PAN, or MSME categorization, to avail of the interest subvention benefits.
SIDBI:
*Impact:* Responsible for receiving and processing claims from banks based on the revised certificate format.
*Action Required:* Process claims according to the revised guidelines.
Key Entities Referenced
Interest Subvention Scheme for MSMEs: A scheme by the Government of India to provide interest subvention (reduction) to Micro, Small and Medium Enterprises (MSMEs).
Government of India: The governing body that has decided to bring modifications in the operational guidelines of the Interest Subvention Scheme for MSMEs.
SIDBI: Small Industries Development Bank of India, the entity to which banks are advised to submit claims as per the revised format for the Interest Subvention Scheme for MSMEs.
Udyog Aadhar Number (UAN): A unique identification number for MSMEs, which can be dispensed with for units eligible for GST or those submitting PAN, or if the loan account is categorized as MSME by the bank.
GST: Goods and Services Tax, a tax applicable to certain businesses. Udyog Aadhar Number (UAN) may be dispensed with for units eligible for GST
Income Tax Permanent Account Number (PAN): A unique identification number for income tax purposes, which can be submitted if a unit is not required to obtain GST and Udyog Aadhar Number is dispensed with.
Sonali Sen Gupta: Chief General Manager, Financial Inclusion Development Department, Reserve Bank of India
Financial Inclusion Development Department: The department within the Reserve Bank of India responsible for matters related to financial inclusion.
RBI/2019-20/155
FIDD.CO.MSME.BC.No.17/06.02.031/2019-20 February 5, 2020
The Chairman / Managing Director & CEOs
All Scheduled Commercial Banks
(including Regional Rural Banks)
Madam / Dear Sir,
Interest Subvention Scheme for MSMEs
Please refer to the operational guidelines for the captioned scheme contained in circular on
‘Interest Subvention Scheme for MSMEs’ issued vide
FIDD.CO.MSME.BC.No.14/06.02.031/2018-19 dated February 21, 2019.
2. In this regard, it has been decided by the Government of India to bring, inter alia, following
modifications in the operational guidelines:
(i) Submission of statutory auditor certificate by June 30, 2020 and in the meantime, settle
claims based on internal / concurrent auditor certificate.
(ii) Acceptance of claims in multiple lots for a given half year by eligible institutions.
(iii) Requirement of Udyog Aadhar Number (UAN) may be dispensed with for units eligible
for GST. Unit not required to obtain GST, may either submit Income Tax Permanent
Account Number (PAN) or their loan account must be categorized as MSME by the
concerned bank.
(iv) Allow trading activities also without Udyog Aadhar Number (UAN)
3. Further, with the trading activity also eligible for interest subvention as indicated at (iv)
above, the ‘Format of Certificate for claiming Subsidy’ i.e. Annex I of the above referred circular
has been revised. Banks are advised to submit claims to SIDBI as per the revised format.
4. You are requested to apprise your branches / controlling offices about the above changes
in the scheme.
Yours faithfully
(Sonali Sen Gupta)
Chief General Manager
Encl. as above
िवत् तीय समावेशन और िवकास िवभाग,क��ीय कायार्लय, 10वीमंिजल, क��ीय कायार्लय भवन, पो.बा.सं.10014, मुंबई 400 001
टेलीफोन /Tel.No: 91-22-22661000 फैक्स/Fax No: 91-22-22621011/22610948/22610943
ई-मेल/ Email ID:cgmincfidd@rbi.org.in
Financial Inclusion & Development Department, Central Office, 10thFloor, C.O. Building, Post Box No.10014, Mumbai
400 001ANNEX I
Format of Certificate for claiming Subsidy
(Hard copy to be submitted to SIDBI)
Name of Lending Institution:
(Amounts in Rupees)
Fresh or Incremental funded Assistance on or after Amount of Interest Relief Claimed
November 02, 2018*
MSME MSME Trading Total MSME MSME Trading Total
(Manufacturing) (Service Activities (Manufacturing) (Service Activities
sector) sector)
(1) (2) (3) (4) (5) (6) (7) (8)
*This may be calculated by arriving at the difference between the opening balances viz. the
principal outstanding as on November 01, 2018 minus any interest accrued.
Note:
i. Data for term loan and working capital accounts may be furnished separately.
ii. NPA accounts may be excluded as no interest subvention shall be admissible for any period
during which the account remains NPA.
We hereby certify that the amounts of Fresh or Incremental Working capital sanctioned/
incremental/ new Loan disbursements and interest relief being claimed thereon, as shown
above, have been correctly calculated in conformity with the Circular issued by SIDBI. We
undertake that in the event of any inaccuracy detected later during audit or otherwise, we shall
immediately refund to SIDBI any excess amount received by us.
(Authorized Signatory)
Place & Date
We hereby certify that we have verified the individual accounts with regard to amount,
incremental / fresh lending, interest charged and amount claimed.
Signature of Statutory Auditor
Place:
Date:
The certificate should be signed by the CA, and his membership number with ICAI should be indicated
Please note this certificate is to be submitted duly certified by the statutory auditor of the lending
institution; a copy of the lending institutions fair practice code and interest rate chart mapped to
internal/external ratings is to be annexed with the claim.