 bill no  260   of  2016 the micro, small  and medium enterprises development (amendment) bill, 2016 by shri gajanan chandrakant kirtikar a billto amend the micro, small and medium enterprises development act, 2006be  it enacted by parliament in the sixty-seventh year of the republic of india as follows:—2 in the micro, small and medium enterprises development act, 2006, after section10, the following sections shall be inserted, namely:—insertion of new sections 10a and 10b"10a (1) every scheduled commercial bank shall lend to the micro, small and medium enterprises at the rate of one per cent plus the rate of fixed deposit of such banks5lending rate and limit for lending of collateral free loans(2) every micro, small or medium enterprise shall be entitled to collateral free loan of upto rupees two crore from scheduled commercial banks10b the central government shall, from time to time, notify suitable incentives to increase the inflow of equity capital in micro, small and medium enterprises"incentives to increase the inflow of equity capital statement of objects and reasonsthe micro, small and medium enterprises development act, 2006 aims to provide for facilitating the promotion and development and enhancing the competitiveness of micro, small and medium enterprises in the country the said act, as well as the guidelines issued by the reserve bank of india in its circular dated 1st july, 2011 and the recommendations of various committees and task groups have brought about considerable positive changes in various areas of development of competitiveness of micro, small and medium enterprises (msmes)however, the msmes, that contribute to eight per cent of the country's gross domestic product (gdp), forty-five per cent of the manufactured output, forty per cent of our exports and that employs an estimated sixty million people, continue to face serious bottlenecks in its development lack of access to adequate and timely credit at a reasonable cost is the most critical problems faced by this sector hence, there is an urgent need to make it mandatory by law for scheduled commercial banks to provide affordable lending rates to msmesthe bill hence, aims to ensure lowest lending rates to msmes, fixed at one per cent plus the rate of interest for fixed deposits of the scheduled commercial banks in the coutnry this would ensure more credit flow to the msme sector, without hurting commercial banks, as they will continue to have freedom to fix lending rates to other sectors or units the bill also aims to make it mandatory for scheduled commercial banks to offer msmes, collateral free loans, up to rupees 2 crore these two key changes in the principal act would revive msmes through increased credit flowhence, this billnew delhi;gajanan chandrakant kirtikaroctober 28, 2016 lok sabha———— a billto amend the micro, small and medium enterprises development act, 2006————(shri gajanan chandrakant kirtikar, mp)gmgipmrnd—2929ls(s3)—17-11-2016