Page 102 - Abhivruddhi

3. Strengthening Business Sphere
For the unorganised sector to contribute to India’s economy, the
business ecosystem needs to build capacities of the entrepreneurs. It starts
with training the entrepreneurs to equip them for successful running of
businesses and financial planning. For these businesses to survive and
grow they need to be mainstreamed to avail the relevant government
schemes. The challenge is the lack of awareness and the wherewithal
to access these schemes. With the shift from cash economy to cashless
economy, their use of technology and adoption of digital payments is
critical. From enabling access to credit to better financial planning for
their business growth and lifecycle needs paves the way for their success.
Here are a few cases that depict major pain areas.
3.1 Access to credit
Anjum sold dry fish but COVID-19 and extended lockdown put
roadblocks in her business as her area was sealed and she was unable to
get out of the community area to procure dry fish. After a complete loss
of income for 2 months and with no other skill, Anjum decided to start
selling vegetables and needed a start-up capital of Rs. 5,000.
Like Anjum, several others needed access to credit to restart their
businesses. As per the CYDA, Pune study, 39% businesses were operational
during lockdown and these included Grocery Stores, vegetable and fruit
shops and dairy in urban areas. Of these businesses, 72% were women
entrepreneurs who ran home based businesses with a sale of Rs. 3,000-
Rs.5,000 per day.
As businesses of this sector have small or no cash reserves for managing
sudden external contingencies, it led to the collapse of a large number
of non-essential businesses (61% in the survey) which were shut during
the lockdown. They included trading and manufacturing businesses like
selling readymade garments, bag making, etc. The major challenge was
to get an access to credit for working capital and revive these businesses.
3.2. Accessing government schemes
The unorganised sector has marginal or limited excess cash flow after
meeting the personal and living needs of the entrepreneurs. There is a need
to enable multiple channels for credit especially for income generation
loans. Unorganised sector should avail the benefits of the government
schemes already implemented. The hurdle is the lack of awareness in the
unorganised sector and also the wherewithal to avail these schemes. E.g.
Food security, PM Svanidhi for vendors, MUDRA loans etc.
3.2.1 Pradhan Mantri Garib Kalyan Anna Yojana

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