The World Bank has approved a USD 500 million programs to help boost India’s MSME sector.
- The USD 500 million Raising and Accelerating Micro, Small and Medium Enterprise (MSME) Performance (RAMP) Program is the World Bank’s second intervention in this sector.
- The first being the USD 750 million MSME Emergency Response Program, approved in July 2020 to address the immediate liquidity and credit needs of millions of viable MSMEs severely impacted by the ongoing COVID-19 pandemic.
- The program targets improvements in the performance of 5.5 lakh MSMEs and is expected to mobilize financing of USD 15.5 billion, as part of the government’s USD 3.4 billion MSME Competitiveness – A Post-COVID Resilience and Recovery Programme (MCRRP).
- The RAMP program will provide better access to finance and working capital for MSMEs by strengthening the receivable financing markets.
- It will also scale up online dispute resolution mechanisms to address the problem of delayed payments.
- The USD 500 million loans from the International Bank for Reconstruction and Development (IBRD), has a maturity of 18.5 years including a 5.5-year grace period.