SME Digital World

Author: SDW Editorial Desk

“MSME Delayed Payments: Updated Online Procedure for Filing Applications Against Defaulting Buyers”

MSME Delayed Payments: Updated Online Procedure for Filing Applications Against Defaulting Buyers

In response to delayed payments from buyers, MSMEs in India often encounter significant challenges. According to the government’s delayed payment monitoring portal, MSME Samadhaan, since October 2017, approximately 1.89 lakh applications involving Rs 43,160 crore have been filed by MSMEs. However, only 36,074 cases totaling Rs 6,235 crore have been resolved by facilitation councils.
For those seeking to file an application online against a buyer who has not settled dues within 45 days of invoice generation, follow these step-by-step instructions:
1. Visit the delayed payment filing and monitoring portal by the MSME ministry at samadhaan.msme.gov.in.
2. Click on the ‘Case Filing for Entrepreneur/MSE Units’ tab.
3. Choose the type of MSME registration — Udyog Aadhaar Number or Udyam Registration Number.
4. Enter the registration number, mobile number (as per the registration certificate), and verification code.
5. Click on ‘Validate Udyog Aadhaar’ or ‘Validate Udyam Registration’ based on your registration type.
6. Enter the OTP sent to the registered mobile number or email address for verification.
7. Access the ‘Application List’ page and click on ‘Application Entry’ located at the top right corner.
8. Input the date of the pending invoice under ‘The date of invoice in dispute’ and click ‘Submit.’
9. Your details will be pre-filled under ‘Petitioner Details’; provide any additional required information.
10. Select the business location from where the dispute has arisen.
11. Opt to send the application to the facilitation council of the state where your corporate office is located (‘Yes’).
12. Enter your office PAN and NIC code of the product sold.
13. Confirm the declaration at the end of the form.
14. Provide buyer or respondent details, including the GST number, and acknowledge the consent statement.
15. Specify the amount owed by the buyer.
16. Enter work order and invoice specifics and upload necessary documents.
17. Validate the information submitted, enter the verification code, and click ‘Final Submit.’
Both you and the buyer will receive notifications upon successful submission of the complaint.

May 14, 2024
Driving Factors: Technology’s Role in Shaping India’s Electric Two-Wheeler Adoption

Driving Factors: Technology’s Role in Shaping India’s Electric Two-Wheeler Adoption

Technological factors have the potential to either impede or accelerate the adoption of electric two-wheelers in India’s evolving electric vehicle (EV) ecosystem, which has witnessed significant growth in recent years supported by government and private sector initiatives. The interim budget also outlined various measures aimed at expediting the expansion of the domestic EV ecosystem, including bolstering charging infrastructure.
As the EV landscape evolves, it becomes evident how policies, market conditions, and technological advancements influence consumer acceptance of these vehicles. Technology emerges as a critical determinant for the adoption of EVs, particularly in the two-wheeler segment, which constitutes one of the largest automobile segments in India.
According to Sushant Kumar, Founder & Managing Director of AMO Mobility, battery technology plays a pivotal role. Advancements in lithium-ion batteries and the emergence of solid-state batteries enhance efficiency, safety, and charging speed, which are crucial for extending vehicle range and enhancing user convenience. Motor technology also significantly impacts performance, with innovations such as brushless DC motors offering improved efficiency and requiring less maintenance.
Furthermore, material science advancements enable the use of lightweight materials that improve range and performance without compromising safety. Kumar notes that these technological strides collectively shape the future of electric two-wheelers, making them more attractive and efficient for consumers.
Anshul Gupta, Managing Director of Okaya EV, emphasizes the importance of finding the right technology as EVs are still in the pilot phase. He highlights the necessity of progressing charging infrastructure, including rapid charging methods and battery swapping techniques, to address concerns about range anxiety and promote widespread adoption.
In the evolving landscape of EV technology, particularly concerning two-wheelers, several technological factors are poised to influence their future development, experts believe.
Prashant Vashishtha, Chairman & Managing Director of Sokudo India, underscores the significance of battery technology advancements, including shifts to more advanced formulations like solid-state or lithium-sulfur batteries promising higher energy densities and faster charging times. Motor technology is expected to advance further, focusing on increasing efficiency and reducing weight, while electronic control systems become more sophisticated to enhance vehicle dynamics and user interfaces.
The integration of IoT and AI technologies plays a vital role in facilitating real-time vehicle diagnostics, enhancing user experience, and increasing vehicle reliability. These technologies contribute to predicting battery life, optimizing energy management, and improving overall vehicle efficiency, according to industry stakeholders.
Gupta also highlights safety as a primary concern for customers due to high voltages and temperatures associated with EVs. LFP batteries are considered safer than NMC batteries due to their higher thermal runaway temperature and longer lifespan, despite requiring more space.
Overall, infrastructure improvements such as fast-charging stations and connectivity features like GPS navigation, coupled with supportive government policies and incentives, contribute to the growing popularity of electric two-wheelers in India’s dynamic mobility landscape.

May 14, 2024
OpenAI’s new search engine

OpenAI’s new search engine may change marketing

Open AI has been changing the way users browse the web. Imagine users asking questions in a natural way, just like they would a friend. OpenAI’s search engine might be built for this conversational approach, requiring marketers to adapt their content to sound natural and answer real user questions.
Excitement is building for OpenAI’s search engine, and it has the potential to disrupt the search landscape as we know it. However, some questions linger. Can OpenAI make money with this new service? And can it truly compete with the mighty Google? One thing’s for sure: the search engine world is a hotbed of innovation and fierce competition, and OpenAI’s arrival just adds another layer of intrigue.
Marketers might need to track new metrics to understand how users find and engage with their content in this new search landscape.
AI search engines might throw SEO for a loop These new search engines, unlike their traditional counterparts, may value different things. They could prioritize content written in a more conversational style, focus on new ranking signals we haven’t seen before, or even interpret what users are really looking for in a completely different way. Since AI can understand and create human-like text, content that directly answers users’ questions in a natural, conversational way might be the key to ranking highly.
OpenAI’s search engine could change the search game Google has been the undisputed king for ages, but if OpenAI takes off, it could shake things up big time. Marketers will need to ditch their “all eggs in one basket” approach and start spreading their SEO efforts across different platforms to stay competitive.
Overall, OpenAI Search presents both challenges and opportunities for marketers. Being adaptable and creative will be key to success in this evolving search landscape.

To learn more, read here: https://www.cmswire.com/digital-marketing/what-openai-search-would-mean-for-marketers/

May 10, 2024
What is AI doing to the environment?

AI is bad for the environment. But it can be better.

Barely a few years have passed, but it feels like we can’t live without AI anymore. Of course, AI has also had its fair share of criticism, but these seem to focus on its ethical and moral impact. Less light is shed on the environmental impact, which has been great indeed.

As AI models become more complex, more energy is required to train and run them. This results in greenhouse gas emissions that contribute to climate change. Researchers estimate that the amount of computing power required to train cutting-edge AI models has doubled every 3.4 months since 2012.
E-waste from AI hardware contains hazardous chemicals that can harm human health and the environment. The World Economic Forum projects that the total amount of e-waste generated will have surpassed 120 million metric tonnes by 2050. Proper e-waste management and recycling are essential to avoid environmental harm.
AI applications like driverless cars and delivery drones can pose a threat to animals and their habitats. The automation brought about by AI may also lead to increased consumption and waste in certain sectors. The use of AI in agriculture could result in the overuse of pesticides and fertilizers, harming biodiversity. AI systems used for environmental management can also be biased if trained on inaccurate or incomplete data.
Some companies prioritize financial gain over the environmental impact of AI technologies. The complexity of AI systems makes it difficult for users to understand their environmental footprint. To address this issue, more transparent procedures and regulations are needed to ensure that AI is developed and used in an environmentally responsible way.

The undeniable potential of AI cannot overshadow the environmental threats it poses. From its massive energy consumption to its contribution to e-waste and disruption of ecosystems, AI’s environmental impact necessitates immediate action. Transparency and responsible development are crucial to ensure AI becomes a tool for a sustainable future, not a detriment. There need to be work done to highlight these challenges and foster a dialogue that paves the way for AI advancements that coexist harmoniously with our planet.

Read more here:https://www.nytimes.com/2024/05/06/business/dealbook/ai-power-energy-climate.html

May 9, 2024
New MSME payment clause in IT Act

New MSME payment clause in IT Act

The Supreme Court declined to hear a petition filed by traders’ associations challenging the constitutionality of Section 43B(H) of the Income Tax Act, which mandates businesses to clear dues owed to micro, small, and medium enterprises (MSMEs) within 45 days to avail tax benefits.
Instead, a bench headed by Chief Justice DY Chandrachud advised the petitioners – Federation of All India Vyapar Mandal, Federation of Madras Merchants and Manufacturers Association, and Confederation of West Bengal Trade Associations – to seek relief from the high court.
The provision came into effect on April 1. The Federation of All India Vyapar Mandal challenged the constitutionality of Section 43B(H), highlighting its adverse impact on the business community, especially MSMEs like textile, chemical, and engineering units based in Gujarat.
The traders’ body sought a review of the provision due to its negative implications on MSMEs, arguing that it unfairly favors medium-scale industries by granting them more leeway in extending credit, thereby causing MSMEs to lose market share. Traders also alleged that the amendment unfairly penalized small enterprises by restricting their ability to offer credit based on their discretion.
The petition further pointed out that large companies were redirecting their orders away from MSMEs registered under the Micro, Small, and Medium Enterprises Development Act, 2006, opting instead to place them with unregistered entities to evade mandatory provisions and maintain longer payment cycles of 90-120 days.
To address working capital shortages and ensure timely payments within the sector, the Finance Act 2023 introduced an amendment to the Income Tax Act by adding clause (h) to Section 43B. This clause mandates that buyers settle outstanding payments owed to MSMEs within 45 days to qualify for tax deductions. Failure to comply results in disqualification from tax benefits until the dues are settled.
In cases of delayed payments to MSMEs, the buyer is liable to pay tax on the overdue amount, which can only be reversed upon clearing the dues to MSMEs. Additionally, interest on the overdue amount accrues at the bank rate notified by the Reserve Bank of India, applicable from the appointed day or an agreed date.

May 8, 2024
How Lenders Navigate Risk in MSME Lending Without Credit History

How Lenders Navigate Risk in MSME Lending Without Credit History

Lending to small and unorganised businesses presents significant credit risk, primarily due to the absence of credit history for assessment. Traditional methods of credit evaluation, such as predicting behavior based on credit history or analyzing cash flows and profitability through financial statements, often fall short in this scenario.
Shikhar Aggarwal, Chairman of BLS E-Services, underscores the importance of identifying and mitigating risks like credit default and market volatility. This approach not only ensures the stability of loan portfolios and minimizes losses but also promotes responsible lending practices. Aggarwal emphasizes that proactive risk management is crucial for MSMEs to demonstrate financial reliability and business acumen, essential for securing funding, growth, and operational success. Moreover, a robust risk management framework builds trust with financial institutions, improving loan terms and access to larger credit facilities, enabling MSMEs to innovate, expand, and navigate economic challenges effectively.
Ujual George, COO of Aye Finance, explains how his company overcame this challenge by developing a tailored underwriting model based on data science and a comprehensive physical presence. Aye Finance’s extensive workforce of 6,000 across 450+ branches nationwide plays a critical role in managing credit risk effectively through this “phygital” (physical + digital) model.
Aggarwal further elaborates on the multifaceted approach NBFCs use to manage risks during lending. This includes assessing liquidity profiles with seasonally adjusted fund utilization patterns, evaluating company profiles based on ownership, industry segment, location, and maturity level, analyzing repayment behavior and asset classification, determining creditworthiness through outstanding debt and credit scores, assessing collateral for secured credit, and considering external factors like economic conditions, business trends, and potential legislative changes that may impact MSMEs.

May 8, 2024
Secretary, Department of Pharmaceuticals launches the MEDITECH STACKATHON 2024 in collaboration with CII at New Delhi

Department of Pharmaceuticals launches the MEDITECH STACKATHON 2024 in collaboration with CII at New Delhi

India’s MEDTECH industry holds immense potential with projections estimating a growth rate of 28% annually: Dr Arunish Chawla
Industry captains and key stakeholders to brainstorm on the Value Chain Mapping of the select medical devices to facilitate meaningful discussions on the way forward
Secretary, Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers Dr Arunish Chawla, launched the MEDITECH STACKATHON 2024 in collaboration with CII in New Delhi today. The MEDITECH STACKATHON is a groundbreaking initiative designed to catalyze transformative change within India’s burgeoning MedTech sector by undertaking a comprehensive value chain analysis of select medical devices. Through close consultation with industry leaders, policymakers, and experts, the STACKATHON aims to address critical challenges, foster domestic manufacturing, and reduce import dependence, thereby positioning India as a global leader in medical technology. Joint Secretary, Department of Pharmaceuticals Shri RP Singh and Chairman, CII National Medical Technology Forum Shri Himanshu Baid, and other senior officials of the Department and representatives of the Industry were present on the occasion.
Addressing the gathering, Dr Arunish Chawla said that India’s MedTech industry holds immense potential, with projections estimating a growth rate of 28% annually, reaching a size of USD 50 billion by 2030. He said that currently, India is the 4th largest market for medical devices in Asia and among the top 20 globally. Net imports for 2022-23 stands at USD 4101 Million with an import coverage ratio of 0.45.
The Secretary said that the sector has witnessed a surge in imports, driven primarily by countries like the US, China, and Germany, however, India’s robust policy ecosystem presents opportunities for export boosts and reducing import dependence through domestic manufacturing.
Pharma Secretary Shri Arunish Chawla emphasized the importance of policymakers, and industry coming together to draw up a sturdy policy stack for the growth of the medical devices industry in the country.
He highlighted the critical need to focus on quality to ensure that India becomes globally competitive.
Exports have overtaken imports in consumables and disposables during last year, he said, and urged the industry to continue with the momentum in other pillars of the media-tech sector.
Collaboration among stakeholders is essential to address these challenges and enhance both the ease and cost of doing business in the sector. By fostering partnerships, boosting investment in research and innovation, and streamlining value chain processes, we can achieve our shared goal of accessible and affordable healthcare for all, he added.
Through the STACKATHON, participants will delve into the complexities of different product segments within the medical devices industry to gain insights into their unique challenges and opportunities, analyze and map value chains across various segments of the medical devices industry to identify key stakeholders, processes, and dependencies, identify critical issues hindering the development of the medical devices industry, such as import dependence, regulatory hurdles, and technological gaps, Dr Chawla said in his address.
The STACKATHON would deliberate in eight focused groups namely Cancer Therapy, Imaging, Critical Care, Assistive Medical Devices, Body Implants, Surgical instruments and Hospital Equipment, Consumables & Disposables, and IVD Instruments and reagents, each tasked with specific objectives including segment-wise identification of important medical devices, assessment of import-export dynamics, examination of duty structures, and their implications across the entire value chain.
Preceding this workshop, group leads and members have undertaken extensive virtual discussions and preparatory work. The challenges persist in the sector, including cost competitiveness, quality assurance, and regulatory hurdles.
Shri Himanshu Baid, Chairman, CII highlighted a shared vision of collaborative excellence, wherein stakeholders unite to drive tangible outcomes and propel the MedTech industry towards unparalleled growth. He said that with India’s MedTech exports surpassing 4 billion dollars, the industry stands poised on a trajectory of remarkable expansion. However, he highlighted the need for enhanced data collation mechanisms to address gaps in product consumption and production within India. He stated that India’s MedTech landscape is brimming with promise, poised to capture 10% of the global market share over the next decade. Endowed with a robust ecosystem comprising world-class hospitals, skilled manpower, and cutting-edge resources, India is primed to emerge as a frontrunner in the global MedTech arena. He further underscored the importance of fostering industry-friendly policies, streamlining regulatory frameworks, and extending support to Micro, Small, and Medium Enterprises (MSMEs) through targeted incentives and technology funds.
Against this backdrop of immense potential, MEDITECH STACKATHON 2024 seeks to harness the collective expertise of stakeholders to propel the industry towards unprecedented heights of innovation and self-reliance.

Originally posted on: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=2019852

May 8, 2024
Repercussions of a Clean Technology Trade War: Lessons from History

Repercussions of a Clean Technology Trade War: Lessons from History

What happens when a leading trading nation faces the reality that its supremacy is waning?
For the first country to grapple with this dilemma — Britain — it led to an enduring identity crisis that continues more than a century later. As the United States confronts a similar crossroads, it must weigh whether free trade or protectionism holds the promise of greater prosperity.
In the 19th century, the UK’s fusion of manufacturing prowess and open commerce propelled it to pre-eminence. By the late 1800s, it accounted for approximately a quarter of the world’s industrial output. However, beneath this imperial confidence lay deep-seated anxieties triggered by the ascent of new global powers.
In Chicago, the Union Stock Yards sprawled over an area half the size of the old City of London, employing tens of thousands and processing enough meat to feed 80% of America’s population. Henry Ford replicated the Yards’ production-line innovations in Detroit to establish car factories on an unprecedented scale. Meanwhile, in Ludwigshafen, south of Stuttgart, Britain ceded its early lead in chemicals to BASF SE, whose vast integrated plants conferred near-monopoly status on Germany by 1900.
Joseph Chamberlain, a former titan of the world’s largest screw-making business and now a prominent British politician, saw the solution in a departure from the Empire’s free-trade ethos. “Tariffs! They are the politics of the future, and of the near future,” he declared at a parliamentary dinner in 1902.
The resultant policy, Imperial Preference, proposed steep levies on imports from outside the Empire. This protectionist approach dominated until the Second World War shattered Britain’s global pretensions, casting a long shadow over its turbulent relationship with the European Union’s trading bloc.
The parallels with present-day America, grappling with China’s manufacturing prowess, are stark. Like late Victorian Britain, a dominant power faces a rival endowed with abundant land, labor, and capital, rapidly closing the gap. Moreover, China’s investments and monumental industrial infrastructure overshadow competitors. China’s dominance of the clean technology supply chain appears near-absolute, producing 84% of the world’s solar modules, 86% of lithium-ion batteries, and a substantial share of wind turbine components and electrolyzers for green hydrogen.
President Joe Biden’s recent remarks underscore America’s response to this challenge, signaling a stance against China’s economic practices with higher tariffs on its products.
The experience of Britain’s brief experiment with protectionism offers cautionary lessons. Despite early 20th-century angst, the UK remained a top-five manufacturing power until the 2000s, when it was overtaken by China, Italy, South Korea, India, Mexico, and Russia. In contrast, nations embracing protectionism encountered stunted manufacturing sectors and enduring debt burdens.
While the United States is unlikely to face such dire consequences, it faces a shifting global landscape where multiple industrial giants vie for dominance. Sustaining its hegemony will require avoiding isolationist tendencies and embracing strategic engagement in the global economy.

May 7, 2024
SEBI Takes Action Against SME for Alleged Financial Manipulation

Sebi Takes Action Against SME for Alleged Financial Manipulation

On Monday, the Securities and Exchange Board of India (Sebi) issued sanctions against 12 entities, including Add-Shop E-Retail, a listed company, and several members of its promoter-management team, for purportedly manipulating financial statements.
According to the Sebi order, the company engaged in fictitious transactions, including fake sales and purchase entries in its accounts. Over the past three financial years, more than 46% of reported sales were found to be fictitious. Furthermore, significant related-party transactions were conducted without audit committee approval.
Add-Shop E-Retail was listed on BSE’s small and medium enterprise (SME) platform in September 2018 and later moved to the main board platform in October 2020. The promoter stake in the company decreased to 27.2% by December 2023, down from 62.99% in April 2020.
This regulatory action coincides with increased scrutiny on SMEs for potential manipulation and heightened monitoring due to concerns about fraudulent activities in the sector.

May 7, 2024
India’s Services Sector Records Strongest Growth in Nearly 14 Years: PMI Data

India’s Services Sector Records Strongest Growth in Nearly 14 Years: PMI Data

India’s Services Sector Records Strongest Growth in Nearly 14 Years: PMI Data
India’s services sector demonstrated robust growth in April, driven by strong domestic and international demand, which bolstered business confidence to a three-month peak, according to a survey released on Monday.
The HSBC Services Purchasing Managers’ Index (PMI) for India eased slightly to 60.8 in April from 61.2 in March, with the preliminary estimate pegged at 61.7. Despite this moderation, the index remained one of the fastest growth rates observed in nearly 14 years, as stated in a press release by the firm.
Since August 2021, the services sector has consistently maintained a level above the threshold of 50, indicating expansion rather than contraction.
Similarly, data tracking India’s manufacturing sector also showed a moderation in April, with a PMI reading of 58.8. This softening in both manufacturing and services contributed to an overall Composite PMI reading of 61.5 in April, down from March’s eight-month high of 61.8.
However, this reading still represented one of the highest levels observed in close to 14 years.
India’s services sector remains dominant, with positive market conditions and strong demand driving the new business sub-index to its highest level in three months and the third-highest level in nearly 14 years.
“India’s service activity expanded at a slightly slower pace in April, supported by a continued increase in new orders, particularly driven by robust domestic demand,” noted Pranjul Bhandari, Chief India Economist at HSBC.
Business activity in finance and insurance witnessed significant growth, as indicated by the survey.
Moreover, services companies experienced the second-fastest increase in new export business in nearly a ten-year period, with gains seen across Asia, Africa, Europe, the Americas, and the Middle East.
“Although new export orders remained strong, they moderated slightly compared to March,” Bhandari added.
Rising food prices and wage pressures resulted in increased cost burdens for survey respondents, prompting firms to pass on some of these costs to customers. The Consumer Services segment witnessed the sharpest increase in input costs, according to the survey.
“In response to growing new orders, firms expanded their staffing levels, although the pace of hiring growth decelerated. Input costs continued to rise sharply, albeit at a slower pace than in March, leading to squeezed margins for service firms, as only a portion of the cost increase was transferred to clients through output charges,” Bhandari explained.

May 7, 2024