Exponential Growth in MSME Registrations and Employment
In the past 15 months, micro, small, and medium enterprises (MSMEs) in India have created close to 10 crore new jobs, as per data from the government’s Udyam portal. Registered MSMEs surged from 2.33 crore in August 2022 to 5.49 crore by November 2024. During this period, employment reported by these enterprises increased significantly, from 13.15 crore to 23.14 crore.
This includes 2.84 crore jobs provided by 2.38 crore informal micro units registered through Udyam certification. Women’s employment accounted for 5.23 crore jobs. Among the registered units, 5.41 crore were micro-enterprises, followed by 7.27 lakh small enterprises and 68,682 medium enterprises.
Union Budget 2024-25: Prioritizing MSMEs
The Union Budget for 2024-25 allocated ₹22,137.95 crore to the MSME Ministry, reflecting a 41.6% increase from the previous fiscal year. This budget emphasized the critical role MSMEs play in job creation and economic development. Key initiatives included:
Collateral-Free Loans: A new scheme to provide term loans for manufacturing MSMEs to purchase machinery and equipment without collateral or third-party guarantees, supported by a guarantee fund offering up to ₹100 crore.
Mudra Loan Expansion: Increasing the loan limit under the “Tarun” category to ₹20 lakh for entrepreneurs with a successful repayment history.
Reduced Turnover Threshold: Lowering the threshold for buyers from ₹500 crore to ₹250 crore to enhance MSME market opportunities.
Support for Food Industries: Financial aid for establishing food irradiation units and food quality testing labs.
Digital and Financial Transformation for MSMEs
The budget recognized the importance of digital transformation, noting that only 6% of MSMEs actively sell on e-commerce platforms. Public sector banks were directed to develop digital footprint scoring to assess MSME creditworthiness, streamlining financial access for small businesses.
