Union Budget 2025: Strengthening MSMEs and Small Business Growth

The Union Budget 2025 introduces several initiatives aimed at empowering Micro, Small, and Medium Enterprises (MSMEs). The government’s focus on credit support, reduced tax burdens, and technological advancement will help small businesses grow and compete globally.

Key Announcements​

1. Enhanced Credit Support for MSMEs​

• ₹10 lakh crore additional credit guarantee for MSMEs.
• Loan limit under the Modified Interest Subvention Scheme increased from ₹3 lakh to ₹5 lakh.
• ₹5 lakh credit limit for micro-enterprises through Udyam Portal-linked credit cards.

2. Revamping the PM SVANidhi Scheme for Street Vendors​

• More than 68 lakh street vendors have benefited from the PM SVANidhi scheme.
• Now revamped with enhanced loan amounts from banks.
• UPI-linked credit cards with ₹30,000 limit introduced for better financial access.
• Capacity-building support included for vendors to scale their businesses.

3. Simplifying Tax Compliance for MSMEs​

• Rationalization of TDS (Tax Deducted at Source) and TCS (Tax Collected at Source) to ease tax filing.
• Increased threshold amounts for TDS deduction on rent (raised from ₹2.4 lakh to ₹6 lakh).
• Expansion of presumptive taxation for small businesses.

4. Support for MSME Digital Transformation​

• Bharat Trade Net (BTN) launched as a digital public infrastructure to help MSMEs access trade documentation and financing solutions.
• Seamless integration with the Unified Logistics Interface Platform (ULIP) to improve trade efficiency.

5. Increased Export Assistance for MSMEs​

• Export Promotion Mission with sector-specific targets.
• Simplified export procedures for handicrafts and small-scale industries.
• Duty exemptions for leather and marine sector MSMEs to boost international competitiveness.

Impact of These Reforms​

1. Boosting MSME Growth & Job Creation​

• Increased loan availability will enable MSMEs to expand operations and create jobs.
• Small businesses will get easier access to finance and technology.

2. Reducing Compliance Burdens​

• Simplified tax and credit regulations will allow MSMEs to focus on business growth.
• Lower transaction costs will increase profitability.

3. Strengthening Digital and Export Capabilities​

• Integration with digital platforms like BTN and ULIP will streamline trade processes.
• Export assistance will help MSMEs reach global markets.

Conclusion​

The Union Budget 2025 provides comprehensive support to MSMEs, ensuring better credit access, simplified compliance, and digital transformation. With these reforms, small businesses are poised to flourish, expand into global markets, and contribute significantly to India's economic growth, reinforcing the nation's journey towards Viksit Bharat.