Overview
- The government introduced the Micro, Small and Medium Enterprises Development (Amendment) Bill in the Rajya Sabha on Tuesday to shorten payment delays and speed dispute resolution for small firms.
- Under the proposal, courts could order buyers to pay at least 50% of awards or claim amounts if appeals drag beyond six months, and judges may release funds that buyers deposit during appeals.
- The measure would require all central public sector undertakings to route MSME invoice settlements through certified Trade Receivables Discounting System (TReDS) platforms, building on a July 10 administrative mandate that already pushed CPSUs to use TReDS.
- Mediated settlements and arbitral awards would be recoverable as arrears of land revenue and treated as enforceable debt under the Insolvency and Bankruptcy Code to make collection and insolvency recovery easier.
- The bill also decriminalises minor compliance breaches, sets up a national digital registration platform, and requires states to expand facilitation councils with legal expertise, changes meant to simplify compliance and improve small firms’ access to working capital.