During the presentation of the Budget 2025 on Saturday, Finance Minister Nirmala Sitharaman declared that the credit guarantee coverage for micro and small businesses would be greatly increased. An extra Rs 1.5 lakh crore in credit would be made available to MSMEs over the next five years when the guarantee limit is raised from Rs 5 crore to Rs 10 crore.
“The credit guarantee cover will be greatly improved to improve access to credit,” Sitharaman stated. The guarantee limit for micro and small businesses will grow from Rs 5 crore to Rs 10 crore, allowing for an extra Rs 1.5 lakh crore in credit over the following five years.
The Finance Minister also stated that the Center will prioritize technology advancements and improved access to funding in order to foster the expansion of these MSMEs and assist them in attaining greater efficiency.
MSMEs will have their investment and turnover limitations raised, enabling a 2.5x and 2x expansion in these levels, respectively. This action will boost confidence, allowing MSMEs to expand and give young people additional employment opportunities.
Additionally, a unique program would be introduced to assist five lakh women and first-time business owners from Scheduled Castes (SC) and Scheduled Tribes (ST). Using the knowledge gained from the successful Stand-Up India program, this program will provide term loans up to Rs 2 crore over the following five years. Programs for online capacity building will also be planned to improve managerial and entrepreneurial abilities.
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