Finance Minister Nirmala Sitharaman presented her eighth Union Budget 2025 on Saturday (Feb 1), announcing new classification criteria for Micro, Small, and Medium Enterprises (MSMEs).
She said that the Union Government will enhance credit guarantee cover for micro, small and medium enterprises to Rs 10 crore ($1,153,437) from the existing Rs 5 crore ($576,718).
Sitharaman said that customised credit cards with a limit of Rs 500,000 ($5767) will be started for small businesses registered on the Udyam Portal. These credit cards will be given to around 1 million businesses in the first year.
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Investment and turnover limits of MSMEs to be enhanced
The finance minister said that the investment and turnover limits for the classification of all MSMEs will be enhanced to 2.5 and 2 times, respectively.
This will give them the confidence to grow and generate employment for youth.
Making it Easier for MSMEs to get Loans
— Ministry of Finance (@FinMinIndia) February 1, 2025
Credit guarantee cover for MSMEs to be significantly enhanced
Customized Credit Cards for Micro Enterprises to be introduced#ViksitBharatBudget2025 #Budget2025 #UnionBudget2025 pic.twitter.com/mLJTmKKnPt
The Economic Survey, which was tabled in the Parliament on Friday (Jan 31), forecast a robust growth rate for India's economy, predicting an expansion between 6.3 and 6.8 per cent in the coming financial year (2025-26).
This survey illustrates India's robust economic fundamentals backed by a stable external account, fiscal consolidation, and private consumption.
"The fundamentals of the domestic economy remain robust, with a strong external account, calibrated fiscal consolidation and stable private consumption. On the balance of these considerations, we expect that the growth in FY26 would be between 6.3 and 6.8 per cent," it said.
(With inputs from agencies)