MSME Budget Updates 2024

 

Key announcements related to MSMEs and startups from the Union Budget 2024:

These initiatives aim to boost the MSME sector and startup ecosystem in India by providing financial support, enhancing credit availability, and creating new opportunities for growth and development.

For MSME's

1. Credit Availability and Support:

New Credit Guarantee Scheme for MSMEs: Introduces term loans for machinery and equipment in the manufacturing sector without requiring collateral or third-party guarantees. This includes a self-financing guarantee fund offering coverage up to ₹100 crore per applicant.

Mudra Loan Enhancement: The loan limit under the 'Tarun' category has been increased from ₹10 lakh to ₹20 lakh for entrepreneurs who have successfully repaid previous loans.

Support During Stress Periods: A new mechanism will facilitate the continuation of bank credit to MSMEs during their stress periods, supported by a government-promoted fund.

Digital Footprint-Based Credit Assessment: Public sector banks will develop a new credit assessment model for MSMEs based on their digital footprints, moving away from traditional asset or turnover criteria.

2. Financial Support and Infrastructure:

Food Irradiation and Testing Labs: Financial support will be provided for setting up 50 multi-product food irradiation units and 100 food quality and safety testing labs in the MSME sector, all with NABL accreditation.

SIDBI Branch Expansion: SIDBI will expand its branch network to serve all major MSME clusters, with 24 new branches opening this year, extending coverage to 168 out of 242 major clusters.

3. E-Commerce and Export Facilitation:

E-Commerce Export Hubs: Establishment of E-Commerce Export Hubs in PPP mode to enable MSMEs and traditional artisans to sell their products in international markets, offering trade and export-related services under one roof.

TReDS Platform Onboarding: The turnover threshold for mandatory onboarding on the TReDS platform has been reduced from ₹500 crore to ₹250 crore, bringing more CPSEs and companies onto the platform, and including medium enterprises as suppliers.

For Startups:

1. Internship Opportunities:

Launch of Comprehensive Internship Scheme: A new scheme will provide internship opportunities in 500 top companies to 1 crore youth over 5 years. The scheme includes an internship allowance of ₹5,000 per month and a one-time assistance of ₹6,000. Companies will cover training costs and 10% of the internship cost from their CSR funds.

2. Industrial and Urban Development:

Investment-Ready Industrial Parks: Development of “plug and play” industrial parks with complete infrastructure in or near 100 cities, in partnership with states and the private sector

New Industrial Parks: Establishment of 12 new industrial parks under the National Industrial Corridor Development Programme.

3. Digital Public Infrastructure:

Development of Digital Public Infrastructure (DPI): Implementation of DPI applications at a population scale in areas such as credit, e-commerce, education, health, law and justice, logistics, MSME services delivery, and urban governance. This initiative aims to promote productivity gains, business opportunities, and private sector innovation.