MSME Schemes - Ministry of Micro, Small and Medium Enterprises

MSME stands for Micro, Small and Medium Enterprises. These industries or enterprises form the backbone of our economy and need assistance and protection from other big companies as they lack resources and technology. To do this the government provides some schemes, rebates or counselling to these enterprises.

Threshold for Enterprises to be Called as Micro, Small or Medium

The existing MSME classification was based on the criteria of investment in plant and machinery or equipment. So, to enjoy the MSME benefits, they have to limit their investment to a lower limit, as mentioned below:

These existing limits were low, thus hampering the overall growth and development of these small and micro businesses. In the Union Budget 2025, the government announced a revised MSME classification that benefits more businesses on a larger scale. 

Budget 2025 - Revised MSME Classification

Also, the distinction between the manufacturing and the services sectors under the MSME definition has been removed. This removal will create parity between the sectors. This revision of MSME classification allows for further scaling of business and also increases healthy competition among businesses.

MSME Schemes Launched by the Government

Credit Cards for Micro Enterprises

A new customisable credit card with a limit of ₹5 lakh, would be issued for micro enterprises registered on the Udyam portal. The plan is to issue 10 lakh cards in the first year.

Scheme for First-time Entrepreneurs

A new scheme will support 5 lakh first-time women, SC, and ST entrepreneurs with term loans of up to ₹2 crore over five years. Drawing from the success of the Stand-Up India scheme, it will also include online capacity-building programs for entrepreneurship and managerial skills.

Fund of Funds for Startups

A new Fund of Funds will be established with an additional ₹10,000 crore contribution, expanding support for startups. This builds on the existing Fund of Funds, which has facilitated over ₹91,000 crore in commitments through Alternate Investment Funds (AIFs).

Focus Product Scheme for Footwear & Leather Sectors

A Focus Product Scheme will be introduced to boost productivity, quality, and competitiveness in the footwear and leather sector. It will support design, component manufacturing, and machinery for non-leather and leather footwear production. The initiative aims to create 22 lakh jobs, achieve a turnover of ₹4 lakh crore, and generate exports exceeding ₹1.1 lakh crore.

Manufacturing Mission - Furthering “Make in India”

The government will launch a National Manufacturing Mission to support small, medium, and large industries under the “Make in India” initiative. It will provide policy support, execution roadmaps, and a governance framework for central ministries and states.

Clean Tech Manufacturing

This mission will support Clean Tech manufacturing as part of the commitment to climate-conscious development. It will focus on enhancing domestic value addition and establishing an ecosystem for solar PV cells, EV batteries, motors, electrolyzers, wind turbines, high voltage transmission equipment, and grid-scale batteries.

Incubation

This scheme helps innovators with the implementation of their new design, ideas or products. Under this from 75% to 80% of the project cost can be financed by the government. This scheme promotes new ideas, designs, products etc.

Credit Linked Capital Subsidy Scheme

Under this scheme, new technology is provided to the business owners to replace their old and obsolete technology. The capital subsidy is given to the business to upgrade and have better means to do their business. These small, micro and medium enterprises can directly approach the banks for these subsidies.

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