Revised Definition of MSME New Eligibility Criteria for MSME

Revised Definition of MSME New Eligibility Criteria for MSME

To Support MSMEs from Crises of COVID  19 and to make India Self Reliant, Finance Ministry through their Economic Package to MSMEs, the definition of MSME has changed. Revised Classification of MSME is a move of government to provide relief to MSMEs who are facing financial crises.  A New Definition of MSME has been issued.  However it is yet to be announced that from which date this new definition will be effective.

Previously “Investment” is the only criteria to classify as MSME however in new definition “Turnover” criteria also inserted.  Under new definition if turnover and Investment both the conditions are satisfied then only one business can be classify as MSME.

Revised Definition of MSME  or Revised Eligibility Criteria of MSME is as below:

MSME TypeInvestmentTurnover
Micro Up to 1 CroreUp to 5 Crore
SmallUp to 10 CroreUp to 50 Crore
MediumUp to 20 CroreUp to 100 Crore

Existing Definition of MSME is as below:

MSME TypeInvestment
Micro Up to 25 Lakh
SmallUp to 5 Crore
MediumUp to 10 Crore

By amendments of MSME Criteria, some big enterprises will also fall into the definition of MSME and can also avail benefits of MSME if above mentioned conditions are satisfied. Further on 13th May 2020, government has Economic Package to MSME segment, through this economic package MSMEs can Avail Collateral free loan for 3 years with 1 years moratorium of principal repayments.

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