CREDIT IMPACT ON PERFORMANCE OF MICRO AND SMALL ENTERPRISES IN TELANGANA

The Micro and Small Enterprise (MSEs) in India is one of the most promising sectors of the employment and economic development. Smaller firms are inherently entrepreneurial ventures and their innovative skills, ability to take risk and thrust to pursue remains unmatched with any other business sources. The sector play crucial role in providing large employment opportunities at comparatively lower capital cost than large industries and helps in industrialization of rural and backward areas. This sector contributes enormously to the socioeconomic development of the country. However according to the previous research it has been proved that the credit availability is one of the major bottlenecks for MSEs development in India. This paper focuses on credit available to micro and small enterprises for the support and encouragement of the MSE’s sector growth and performance. Focus on the impact of loans and advances under various credit programs taken by MSEs for its performance and growth. The study revealed that the credit has an impact on MSE’s performance. The study concludes that the credit programs formulated by state and central governments has to consider filed level reality and financial institutions which are serving these credit programs have to treat MSEs as medium and large enterprises. Than only the introduced credit programs can get success as well as influence more on performance oriented development of the MSEs in Telangana state.