Abstract
Currently, the whole country is going across a stressful era. Pandemic has swept the whole planet into its grasp and has smudged the lives of citizens as well as the global economies as a result. COVID-19 has been one of the 2020 mega tragedies. The correlation is clear since the primary issue does seem to be unemployment and financial losses, which causes a huge decrease in consumer spending for all industrialized nations. Consequently, workers have been eliminated, and consumers have a drastic lack of their wages, creating a large fall in prices. Findings reflect that economies all around the world are suffering from COVID-19, which has made the entire world panic and the pandemic virus has taken over almost 195 countries in its grip. It is quite evident that the enterprises in the MSME sector are the most vulnerable ones in the era of the COVID-19 pandemic because of their size, the scale of operation, limited financial managerial resources, and more importantly, they do not have the capacity to deal with something so unexpected.
TopResearch Methodology
Secondary research was conducted to develop government strategies to minimize the COVID-19 fallout on MSMEs in India. A detailed study of the existing literature has been done to come across the significance and investigate the necessity of MSMEs. The data was collected from secondary sources, i.e., available articles, journals, reports, books, and websites.
Key Terms in this Chapter
CRR: The percentage of cash required to be kept in reserves, vis-a-vis a bank's total deposits, is called the Cash Reserve Ratio. The cash reserve is either stored in the bank's vault or is sent to the RBI. Banks do not get any interest on the money that is with the RBI under the CRR requirements.
NBFCs: Nonbank financial companies (NBFCs), also known as nonbank financial institutions (NBFIs), are financial institutions that offer various banking services but do not have a banking license. Generally, these institutions are not allowed to take traditional demand deposits—readily available funds, such as those in checking or savings accounts—from the public.
KYC: KYC means Know Your Customer and sometimes Know Your Client. KYC or KYC check is the mandatory process of identifying and verifying the client's identity when opening an account and periodically over time.
NPA: A nonperforming asset (NPA) refers to a classification for loans or advances in default or arrears. A loan is in arrears when principal or interest payments are late or missed. A loan defaults when the lender considers the loan agreement to be broken, and the debtor is unable to meet his obligations.
Fintech: Financial technology (Fintech) is used to describe new tech that seeks to improve and automate the delivery and use of financial services. When fintech emerged in the 21st Century, the term was initially applied to the technology employed at established financial institutions' back-end systems.
NGOs: A non-governmental organization (NGO) is a non-profit group that functions independently of any government. Sometimes called civil societies, NGOs are organized on the community, national and international levels to serve a social or political goal such as humanitarian causes or the environment.
PSUs: A state-owned enterprise in India is called a public sector undertaking (PSU) or a public sector enterprise. Those companies that are owned by India's union government or one of the many state or territorial governments or both.