Budget announcement on Initiatives to boost MSME Sector By Mr. Narinder Wadhwa, Managing Director & CEO of SKI capital
Below the Budget announcement on Initiatives to boost MSME Sector By Mr. Narinder Wadhwa, Managing Director & CEO of SKI capital
The Union Budget 2025 introduces several measures aimed at bolstering the Micro, Small, and Medium Enterprises (MSME) sector, which could significantly influence the SME Initial Public Offering (IPO) landscape in India. Key initiatives include:
1. Enhanced Credit Guarantee Scheme:
A new Credit Guarantee Scheme has been announced, allowing MSMEs to obtain term loans for machinery and equipment purchases without the need for collateral or third-party guarantees. This self-financing guarantee fund offers coverage of up to 100 crore per borrowing unit.
2. Increased MUDRA Loan Limits:
The government has doubled the loan limit under the Micro Units Development and Refinance Agency (MUDRA) scheme to 20 lakh for entrepreneurs who have successfully repaid previous loans. This move aims to support micro-enterprises and small businesses with favorable loan terms.
3. Expansion of SIDBI Branches:
The Small Industries Development Bank of India (SIDBI) plans to open 24 new branches in MSME clusters over the next three years, expanding its coverage to 168 clusters. This expansion is intended to provide localized support and easier access to credit for small businesses across the country.
4. Establishment of E-commerce Export Hubs:
The government plans to establish e-commerce export hubs in Public-Private Partnership (PPP) mode for MSMEs and traditional artisans. These hubs will facilitate the sale of products in international markets, aiming to boost the share of MSME-specified product exports.
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