Only 3 percent businesses found the reduction of EPF contribution for organisations -- from 12 percent to 10 percent -- to be useful.
Only one-third of small and medium businesses (SMBs) are looking to avail at least one benefit under the central government's Atmanirbhar Bharat initiative, stated a survey conducted by market research firm Kantar.
According to the survey, SMBs prefer schemes that offer immediate cash benefit over those aimed at long-term recovery.
While 68 percent of SMBs were aware of at least one scheme under the centre's Atmanirbhar Bharat initiative, only 32 percent were considering availing of at least one of the benefits. "One reason for the lower uptake of credit guarantee and loan schemes has been their ability to manage working capital during the pandemic," Kantar said.
"At the start of April, 51 percent of SMBs said they had less than two months of working capital and by the third week of June the percentage of firms dropped to 30 percent leading to a drop in requirement of the government loan scheme for MSMEs," the study said according to an Economic Times report.
"Businesses have figured out how to manage their working capital," said Biswapriya Bhattacharjee, executive V-P of the insights division at Kantar, adding that the requirement of loans at market interest rates is not really appealing for SMBs.
While demand for long-term measures has been low, a larger number of SMBs are looking to benefit from the extension of the deadline for filing income tax and GST.
A part of the package was loans at lower interest rates for MSMEs and 12 percent of businesses said they would avail this scheme.
Only 6 percent businesses said they would avail benefits under the government’s Rs 20,000 crore debt provision for two lakh stressed MSMEs. While about 4 percent said they will take loans where the government will offer 100 percent credit guarantee cover, only 3 percent found the reduction of EPF contribution for organisations -- from 12 percent to 10 percent -- to be useful.Amit Maheshwari, Managing Partner at chartered accountancy firm Ashok Maheshwary & Associates, said, "Businesses are looking to bring down debt at this time, not increase it by taking more loans. They’re more inclined to conserve cash by cutting costs - by reducing headcount, cutting salaries, giving up their leases."