Receivables Management of Msmes A Study of Msmes in Tamilnadu

Abstract

The performance of SSI was focused mainly at National level, while newlineissues like size, growth, structure and productivity were left to the States, newlinewhich paid inadequate attention to these issues. Liberalization has exposed newlineIndian MSMEs to unequal competition with its counterparts in the industrially newlineadvanced countries. The history of funding of the MSMEs reveals that the newlinesector has been mostly relying on self finance and debt finance through newlinebanking system. Lack of demand and shortage of working capital are the main newlinereasons for acute and incipient sickness in both the registered and unregistered newlineunits in SSI sector. newlineTask force of Prime Minister on MSMEs in January 2010 reported that newlineshortage of capital, particularly working capital, is the major problem faced by newlinethe enterprises in the unorganized sector, which constitutes 94 % of MSMEs in newlineIndia. According to the Task Force on MSMEs, workable legal options should newlinebe developed for the securitization of trade credit receivables and for the newlinepromotion of factoring services. newline