Summary of the Announcements made by the Government for the MSME Sector On 13th May, 2020

Summary of the Announcements made by the Government for the MSME Sector On 13th May, 2020

Specific to MSME Sector 


Government of India announces Collateral Free Automatic Loans worth Rs.3 lakh crores for MSMEs, with. 

100% Credit Guarantee 

12 month moratorium on payment of principal 

No Guarantee Fee & Collaterals 

Tenor– 4 years 

To benefit 45 lakh MSME Units 


Udyam se Udyog ka Naya Bharat! Government to support Stressed MSMEs with infusion of Rs.20,000 crore equity support through Subordinate Debt 

Stressed MSMEs or MSMEs with NPA loans will be eligible 

More than 2 lakh MSMEs likely to be benefitted 

Government to infuse Rs.4000 crore in Credit Guarantee Trust Fund for MSEs 


Big boost for the MSME Sector!Fund of Funds created to infuse equity worth Rs.50,000 crore in the MSME Sector 

A Rs.10,000 crore Corpus Fund created. 

To help potential MSMEs in expansion 


Growth beyond leaps and bounds with new defined MSMEs- Distinction between manufacturing and services MSMEs removed. Investment limits revised upwardly. 

Criterion of turnover added. 

Breaking the shackles of old definition, MSMEs to grow leaps and bounds 

Micro enterprises – investment upto Rs.1crore and turnover upto Rs.5 crore 

Small enterprises – investment upto Rs.10 crore and turnover upto Rs.50 crore 

Medium enterprises – investment upto Rs.20 crore and turnover upto Rs.100 crore 


Local hoga Global! In a major initiative, Global tenders to be disallowed for Government tenders upto Rs.200 crore to enable MSMEs to participate in the Government procurement process. 


Government of India and CPSEs to clear all receivables of MSMEs in the next 45 days 


E-market linkages for MSMEs across the board to provide marketing opportunities.  

Social Media Posts relating to other Announcements having positive impact on MSMEs. 


Rs.2,500 crores EPF support for businesses and workersfor three more months August, 2020. This will benefit more than 3.5 lakh units and 72 lakh employees. 


Special Liquidity Scheme for Non-Banking Financial Companies, Micro-Finance Institutions, Housing Finance Companies worth Rs.30,000 crore. 


To cater to liquidity needs of MSMEs, Partial Credit Guarantee Scheme 2.0 for NBFCs worth Rs.45000 crore introduced. Government of India to bear the first 20% of loss. 


Major Relief to Contractors 

All Central Agencies like Railways, Ministry of Road Transport& Highways, Central Public Works Dept, etc. to grant extensions of contracts up to 6 months without costs to contractor. 


Expediting refunds to partnerships, proprietorship & LLPs will help the MSMEs