CEA urges flexible SMA norms for MSME loans
In short
Chief Economic Adviser V Anantha Nageswaran called for more flexible special mention account rules for MSME loans. He said a fixed 90-day overdue timeline does not fit every small business because cash flows differ across sectors.
This matters for MSMEs and lenders because loan stress rules can affect how accounts are classified. The reporting does not say whether the rules will actually change.
What the reporting says
Chief Economic Adviser V Anantha Nageswaran called for flexible special mention account norms for MSME loans, saying a uniform 90-day overdue timeline does not suit all businesses. The Business Standard Finance summary says companies across sectors have different cash-flow cycles, which is the reason cited for flexibility. The reporting does not say whether any rule change has been proposed or adopted by lenders or regulators.
Why it matters
Chief Economic Adviser V Anantha Nageswaran called for flexible special mention account norms for MSME loans, arguing that a uniform 90-day overdue rule does not suit all businesses. The summary says sectoral cash-flow cycles differ, which is the basis for the call. The reporting does not say if regulators will act on the suggestion. The likely effect would be on MSME borrowers and lenders.