By Mr. Winny Patro, CEO & Co-founder, Recordent
“In the age of data and technology solving many problems for businesses, MSMEs are still struggling with delayed payments and are caught up in a vicious cycle of cash flow problems. An SME entrepreneur spends more time dealing with late payments than growing his business. Introduction of section 43B(H) had an impact around the end of financial year 2024 closing and will again only impact late payers during FY closings. Access to working capital and MSMEs samadhan filing, addresses the cash flow at the fag end of the problem. There is a need to address the problem holistically like how the banking industry got better with timely payments due to credit bureaus. MSME data stack could be one of the solutions to reduce credit risk and avoid late payments. In addition to this, benchmarking payment terms based on sectors and nature of products/services could be another solution. Hoping that the upcoming budget gives importance to solve this massive problem of ₹10 lakh+ crore late payments stuck in the MSME sector in India”.
