MSME and manufacturing are a key focus of the new budget release. As previously discussed by the ministries, the manufacturing segment contributes the least to employment. Thus, the budget will focus on the growth of MSME especially in the manufacturing segment. The Finance Minister presents the budget claiming it to provide easy financing and regulation. Following are some key highlights about the MSMEs and Manufacturing segment.
MSME And Manufacturing Budget 2024 Updates
MSMEs are under the benefit of the new budget release. The government focused on several aspects of the MSMEs, especially the MSMEs related to manufacturing. The government provides MUDRA loans for the MSMEs whose maximum limit was Rs. 10 lakhs. However, it increased to Rs. 20 Lakhs now. Apart from the MUDRA loan, the government will also focus on providing the term loan without the collateral. It will also provide guaranteed cover up to Rs. 100 crores for each applicant.
We all know that MSMEs go through a lot of difficulties to get access to credit. The government is trying to provide a lot of new schemes to help MSMEs get loan access easily. They often don’t get the credit because of a lack of collateral. The MSMEs will get easy credit support through the Small Industries Development Bank Of India (SIDBI). The current year will open twenty-four new branches.
The government will also give attention to the quality this time. Thus, the government will now focus on aspects like setting up new food irradiation, and quality and safety testing units under the MSME category. Apart from that, there will also be 50 multi-product food irradiation units. It will help in production for manufacturing MSMEs. However, there is a need to provide a market as well. MSMEs will easily reach the new market with the help of e-commerce. Social media has the power to take the MSME’s small business much high.
MSME Budget 2024 launched a special fund for Rs. 100 Crores to the MSMEs. The government changed the system of MSME credit a bit. The public sector banks often face difficulty in recovering the loans. Thus, the new system will now lead to the banks building their in-house capability for assessing credit. Earlier, it used to rely on external assessment. The MSMEs will get the credit availability while they are in SMA. In conclusion, the extension of the limit on the Mudra loans for the Tarun stage and the credit guarantee scheme will turn out a great initiative for the MSMEs.