Informist, Wednesday, Sep 18, 2024

--Banking secy: To soon announce norms for Unified Pension Scheme

--Banking secy: Rolled out MSME credit plan in pilot phase

--Banking secy: Aim MSME credit at 27.5 trln rupees FY25, up 10% YoY

NEW DELHI - The government will soon notify the norms to implement the newly announced Unified Pension Scheme, Department of Financial Services Secretary Nagaraju Maddirala said today. "The norms are in place and have been finalised, they will be notified soon," he said, on the sidelines of the launch of NPS Vatsalya Scheme.

Effective Apr 1, 2025, the Unified Pension Scheme aims to provide an assured pension, family pension, and assured minimum pension for government employees. To address the demand for assured returns, the Cabinet decided that 50% of the average basic pay drawn in the last 12 months prior to superannuation for a minimum qualifying service of 25 years would be given as an assured pension. For those with less than 25 years but over 10 years of service, the assured sum would be a proportionate sum calculated on a pro-rata basis.

The Unified Pension Scheme also assures family pension, under which 60% of the pension will be given to the immediate family after the demise of an employee. The third feature is an assured minimum pension, which is devised to address the issue of employees with government service for at least 10 years. Under this, 10,000 rupees will be given to such employees as a minimum assured pension.

While employees' contribution to the Unified Pension Scheme will continue to be at 10%, the Centre's contribution will be raised to 18.5% from 14%.

Maddirala also said that the government has set a target for lenders to give loans worth 27.5 trln rupees cumulatively to micro, small and medium enterprises in the current fiscal, up 10% on year. The government is committed to increasing credit to the MSME sector for their growth, the banking secretary said.

He also said that the government has already launched a pilot with a few state-owned banks to test out the self-developed MSME assessment model to extend credit to them, as announced in the Budget for 2024-25 (Apr-Mar). To make credit more accessible to MSMEs, Finance Minister Nirmala Sitharaman had announced that new, independent, and in-house mechanisms will be developed by public sector banks to build their in-house capability to assess MSMEs for credit, instead of relying on external assessment.

While the department is fairly satisfied with the progress that the banks are making to increase their efforts in MSME credit lending, Maddirala said that there are some snags in the debt recovery process by tribunals.

To address the issues and hold further discussions, the financial services department will hold a meeting with chairpersons of Debt Recovery Appellate Tribunals and presiding officers of Debt Recovery Tribunals on Saturday, he said. "A lot of cases are stuck in tribunals and the resolution takes ages, so we need to make them move fast," Maddirala said. "We have prepared and shared a standard operating procedure to the tribunals, we will discuss them further at the meeting."

The government had last held a meeting with debt recovery tribunals on Feb 17 when the banks were directed to ensure the presence of their officers at all the hearings of their respective cases before judicial forums. End

Reported by Priyasmita Dutta

Edited by Deepshikha Bhardwaj

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