Q&A library

We manufacture face masks. What advice can you give us to scale up?
Questioned by alka deore, Maharashtra
The pandemic impact has prompted many of the garment industry to diversify into the mask making business, considering the market demand post the Covid-19 scenario. In order to create demand, for the mask made by your firm, its essential to understand the requirement of the customer, as they may require eco-friendly, environmentally safe cloth masks at an affordable cost. The next step is to reach out to institutions, corporates, residential colonies, schools, colleges and corporate offices, wherein the requirement would be on a recurring basis. Regarding the usage, masks have become a new normal now, therefore it will be present for a reasonable period. Mask is a new and evolving product for the buyers now. However innovation and comfort is key to sustain in this business and customer feedback is essential, since this feedback and tests are important before bulk manufacturingSome feedback on masks from an article in Apparel Resources dated June 24th 2020. Some buyers have shared feedback for the need of extenders to give comfort to the wearer, elastic ear loops instead of fabric ear loops, use of interlining in between two fabric layers to keep more firmness, having the upper portion of the mask tighter as compared to the lower, so that warm breath exhales more from the bottom than from the top, thus minimising chances of glasses getting fogged and misty for people who wear spectacles. Our domestic market is gaining a lot for masks and renowned brands like Adidas India and Wildcraft have taken a lead and are capturing the market aggressively. The usage of online payment platform will also help to ensure prompt cash flow.

We are the developer of a 4 MW small hydroelectric project in the Idukki district of Kerala. Because of the present situation, we are finding it very difficult to secure debt finance for this project. Could you please help us in this regard? (About the project: The total project cost is Rs. 27.8 Cr and estimated annual revenue is Rs. 6.55 Cr. Present status: All statutory clearances secured, land acquisition and dam construction completed)
Questioned by Rakesh Roy, Kerala
The application for availing subsidy can be submitted through the online portal (www.mnre.gov.in). A large number of banking and non-banking institutions are financing renewable energy projects significantly. Small hydropower projects, i.e. those with a maximum output of less than 10 MW, often have additional features that make them less profitable and thus more difficult to finance than larger projects. Revenue of the project is small and consequently the economic feasibility is very cost-sensitive and the risk is higher when compared to larger projects. In your case, a bank or other investment institution shall provide the majority of the funding needed. Banks can provide financing at more favorable terms than can be obtained on the private market. Private agencies such as commercial banks and insurance companies also provide funding for hydro projects. However, their interest rates will be higher and payback time will be shorter. To obtain a loan, you must convince the bank/FI with the economic feasibility of the project and provide security. Loans shall be secured against assets or property owned by you. As the lender's interests are well secured, the need for a tight network of contracts to control risk can be relaxed, making the financing structure more flexible. You may visit your nearest bank / reputed NBFC for opting suitable loan scheme.

How do I start a vermi compost plant? How do I apply for government loan, and benefits for this business?
Questioned by abhishek singh parmar, I t college
Central Bank of India has a scheme by the name Cent Vermicompost Scheme. Its main objective is to meet the working capital requirement of setting up the vermicompost units. Repayment time is up to 5-8 years. Limit is maximum up to Rs. 2 crore. For further assistance visit a Central Bank of India branch.It is eligible for all Farmers, SHGs, JLGs of farmer's including tenant farmers, share croppers, Proprietorship/Partnership Firms/Pvt./ Public Ltd. company/ies. etc., Non Government Organizations (NGOs), Cooperatives, Municipal Corporations, Federations, Agricultural Produce Marketing Committees, Marketing Boards and Agro Processing Corporations.

Can I get a loan under CGTSME SCHEME?
Questioned by Rajesh Khandelwal, Maharashtra
If you are new or have an existing small scale manufacturing or service activity you are eligible for the loan. But there are certain entities excluded from it like educational institutions, retail trade, agriculture, self-help groups and training institutes. The business unit must be established as a distinct unit. Necessary approvals, certifications, tax registrations need to be obtained in order to avail the credit facility. The business idea needs to be concrete and a well defined such as model, prospects, cost analysis, projections etc.

Want to start organic cloud kitchen in Delhi for serving organic thali in Delhi. Kindly advise
Questioned by Shaila Aggarwal, Delhi
Given that people are not planning to step out possibly until sometime next year it is a good idea to have a cloud kitchen to have takeaways from. Also since health has now become a priority - organic is the way to go. Make sure to focus on high quality ingredients, safety guidelines and proper delivery.

I had availed a Gold Loan from " Rupeek " in the month of March 2020 as working capital for my business. Now the gold rate has increased to a different level and would like to know how I can avail a Top up loan for my business purpose. Pls suggest. The top up loan is for restarting my business and the same can be closed within a few weeks.
Questioned by Anushree Ajit Dixit, Maharashtra
The benefit of taking a gold loan is that you get instant liquidity and a free valuation of your gold. You will get higher amounts of loan (LTV) depending on the purity and net weight of the gold deposited. So when you apply for taking a loan by using gold as a collateral, many banks and financial institutions will be willing to lend you the money at reasonable interest rates in attractive features and options. Depending on the bank / NBFC you are taking the loan from, you can also be eligible for part release facility. You may avail gold loan from your nearest Muthoot Fincorp Ltd (MFL) branch, that provides 24x7 SMS loan top up facility. There are several gold loan schemes in Muthoot Fincorp Ltd. for entrepreneurs to restart business. The "Ashwas Dinam Gold Loan" and “Restart India Pradhan Gold Loan” provides maximum value for gold, 180 days steady interest, reduced interest on daily diminishing balance, 24x7 online payment options, 24x7 SMS loan top up facility, part redemption, cash reward for digital transactions and no hidden / pre-closure charges.Please visit your nearest Muthoot Fincorp branch or paste the link on your browser to know more http://bit.ly/MuthootFincorpADGL and http://bit.ly/MuthootFincorpRIPL

I want to purchase raw material for my business. Need financial support. Please advise
Questioned by A.Chandrasekhar, Tamil Nadu
There are schemes available under MSME in Pradhan Mantri MUDRA Yojana (PMMY), wherein any manufacturing MSME having Udyog Aadhaar Memorandum (UAM) can apply for the assistance under the Scheme. These loans are known as MUDRA loans and has products/ schemes namely Shishu (loan up to 50,000/-)Kishore (loans above  50,000/- and up to 5 lakh), Tarun (5 lakh to 10 lakh). Loans are extended for a variety of purposes which also caters to the Textile Products sector activity. For details visit: http://bit.ly/RIMUDRA https://www.mudra.org.in/offeringsAlso Small Industries Development Bank of India (SIDBI) offers a wide range of finance schemes to the Micro, Small, and Medium Enterprises (MSME) industry. Loan amounts can range from Rs.10 lakh to Rs.3 crore. Loan repayment tenures can go up to 10 years. These loans, which are offered at attractive interest rates, provide the necessary capital for the growth and expansion of MSMEs. Loans above Rs.1 crore can be availed without any collateral required. Loan subsidies are also available.Further loans are available under GECL, this Emergency Credit Line Guarantee Scheme provides 100% guarantee coverage by NCGTC to Member lending Institutions on GECL of up to Rs. 3 lakh crore to eligible MSMEs. This Scheme will include MSMEs/ Business Enterprises which are constituted as Proprietorships, Partnerships, Registered Companies, Trusts and Limited Liability Partnerships (LLPs), and also interested borrowers under PMMY. https://www.bankofindia.co.in/pdf/FAQs_on_ECLGS.pdf

Under the ECLG scheme, we have availed 20% of loan amount as on 20/02/2020. Immediately the NBFC started encashment of ECS stating that we cannot avail 20% ECLG scheme and moratorium too. Request your input on the same.
Questioned by Duhita Bhole, Maharashtra
The ECLG is a loan for which 100% guarantee would be provided by National Credit Guarantee Trustee Company (NCGTC) to Member Lending Institutions (MLIs), and which will be extended in the form of additional working capital term loan facility in case of Scheduled Commercial Banks (SCBs) and Financial Institutions (FIs), and additional term loan facility in case of Non-Banking Financial Companies (NBFCs), to eligible MSMEs/ Business Enterprises and interested Pradhan Mantri Mudra Yojana (PMMY) borrowers. Credit under GECL would be up to 20% of the borrower’s total outstanding credit up to Rs. 25 crore, excluding off-balance sheet and non-fund based exposures , as on 29th February, 2020, additional credit shall be up to Rs. 5 crore. It is not necessary that the existing loans of the borrowers should be covered under the ECLGS of NCGTC. There will be a moratorium of one year on the principal repayment, but interest payment will continue during this period (be payable during the moratorium period). The principal repayment will then be converted into equated instalments spread across the remaining period, which is 36 months. A separate loan account will be opened, which is distinct from your current loan accounts. In that sense, the scheme is not a top-up on your existing loan. https://www.ncgtc.in/

I want to enquire if there are any schemes for agro clusters. Please advise on CGTMSME
Questioned by Kaustuv Ganguly, West Bengal
Under CGTMSE there are few entities which are excluded from coverage like educational institutions, agriculture, Self Help Groups and Training institutions. For Agro clusters there is one scheme launched by Ministry of Food processing Industries by the name Agro Processing Cluster Scheme which aims at providing modern infrastructure and facilities to help the entrepreneurs to establish food processing units by building a supply chain between the farmers and the markets. Financial assistance is provided by govt agencies, public sector units, NGO’s etc. The terms and conditions have to be met in order to avail the financial assistance.

My GST blocked due to returns not submitted due to financial problem. Ontime collections not received. Please give the solution to restart the business.
Questioned by Komula Radha, Telangana
With pandemic effect still continuing and impacting businesses, the government has announced the extension of dates from June 30th to September 30th for the submission of GST annual returns for FY 18 - 19. This is crucial since if a taxpayer has not filed GSTR for two or more consecutive months, then he/she cannot generate e-way bills to do dispatches and receive goods, resulting in a standstill. Only when a taxpayer files GSTR, the e-way bills will get unblocked on the next day. Moreover GST credits can be used to create an additional revenue source for banks while also generating more liquidity for the government and builds the much-needed confidence within the business community. Hence the GST filing remains utmost important. The loans for the restart of business for various small scale industry are available from NBFC’s and MFI’s with collateral given, Muthoot Fincorp Ltd. has launched a special Gold Loan Scheme for businesses known as "Ashwas Dinam Gold Loan" The features are:• Maximum loan value against gold• Steady interest rate for 180 days• 24x7 online repayment options• Reducing interest on daily payments.Other Small Business loans for SME also available to meet the working capital needs or to improve the scope of the business. However a good credit score is equally important to avail these loans.https://blog.saginfotech.com/gst-due-dates-e-filing-of-tax-return

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