The youth of today’s generation are always enthusiastic about having their own venture despite working in the 9 to 5 shift job. Skilled workers, instead of having skills, are deprived of the human resources and credit for starting their business. The Indian Government has made collateral-free credit available to this micro, small, and medium enterprises. Micro small and medium enterprises contribute primarily to the social and economic growth in many developed and developing countries. Our government has taken many initiatives to help the owners of the MSME to run and operate their enterprises efficiently. Also, the Indian MSME sector has employed around 120 million persons and contributed approximately 45 percent of the overall exports from India. Here, in this article, we will see the government schemes for MSME.
What are Micro Small and Medium Enterprises?
Micro small and medium enterprise (MSME Registration) is considered to be the cornerstone of the Indian economy. They contribute to the 45 percent of India’s total industrial employment, 50 percent of India’s total exports and 95 percent of all industrial units of the country. These industries are mainly based out in small and remote areas of our country. In Accordance with the Micro, small and medium enterprises Development Act, 2006, the MSME are classified into two categories:
- Manufacturing Enterprises
- Service Enterprises
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What are the MSME schemes launched by the Indian Government?
The Indian Government is running various schemes to help the MSME Sector grow and work efficiently. In the recent budget presented in the Parliament on July 5, 2019, the finance minister Nirmala Sitharaman focused on the traditional industries such as bamboo, khadi, and honey to create an economic value chain.
Pradhan Mantri Mudra Yojana
This yojna was launched in 2015 and in the time period of 2 years it generated more than 1.8 crore jobs via MUDRA due to the loans and business of the scheme. Prime Minister Modi launched Pradhan Mantri Mudra Yojana, wherein Refinance Agency Bank, Micro Units Development and MUDRA Banks shall provide loans to non-banking financial institutions and micro-finance institutions at low rates, and these institutions shall in turn offer low-interest loans to MSMEs and start-ups.
Hence, this Yojana is one of its types, made and actualize to motivate Indian entrepreneurs. Loan amount of upto Rs 10 lakh can be obtained under the MUDRA scheme.
The three categories of businesses that can obtain loans under the MUDRA loan for their business startups:
Category 1: Shishu: New businesses – Can avail Loans up to Rs 50,000
Category 2: Kishor: A mid-aged business – Can avail Loans up to Rs 5 lakh.
Category 3: Tarun: an existing and experienced business- can avail Loans up to Rs 10 lakh.
Financial Support to MSMEs in ZED Certification Scheme
This scheme is focused for the already existing units and new manufacturing units to encourage them to create better products with zero defects and high quality – ZED or Zero Defect and Zero Effect mission for manufacturing zero defect products. Focus is to facilitate manufacturers to accept and promote a high class manufacturing processes, and use such technology with the purpose to ensure that their products are the best in the class.
Government shall provide both technology and financial support and tools to make sure that there are zero defects in the products.
Development of Khadi, Village and Coir Industries
PM Modi launched various schemes for the development of MSMEs for operating under the Khadi, Village and Coir Industries in the nation. These shall include the following:
- Market Promotion & Development Scheme (MPDA)
- Domestic Market Promotion (DMP)
- Revamped Scheme of Fund for Regeneration of Traditional Industries (SFURTI) –
- Trade and Industry Related Functional Support Services (TIRFSS)
- Export Market Promotion (EMP)
- Coir Vikas Yojana (CVY)
- Welfare Measures (PM Suraksha Bima Yojana (PMSBY)
Scheme of Fund for Regeneration of Traditional Industries (SFURTI)
SFURTI is the scheme for the development of Khadi, village industries and coir industries in which the government provides the owners with improved equipment, common facilities center, business development services, training, and design.
ASPIRE (A scheme for promoting Innovation, Rural Industry, and Entrepreneurship)
ASPIRE is the scheme launched by the government which aims to generate employment opportunities and encourage entrepreneurship culture among the youths. It can be done by implementing incubation through technical and research institutes. Incubation is launched by the government, which helps the innovators to promote new ideas, design, products, etc. Also, the government finances almost 75 to 80 per cent of the project cost.
Credit Linked Capital Subsidy Scheme (CLCSS)
This scheme is launched for upgrading the technology of small scale industries including Khadi, village, and coir industrial units. Also, to enhance the plant and machinery of small enterprises with the state of art technology.
Prime Minister’s Employment Generation Programme
The Khadi and Village Industries Commission (KVIC) launched this scheme at the National Level which aims to generate self-employment opportunities among the youth as well as the skilled one.
In a statement reported by the Road, transport, and Highway minister of India, Nitin Gadkari, an estimated 45.22 Lakh persons, are provided with employment opportunity and 5.45 lakhs micro enterprises , with a margin money subsidy of Rs 12;074 crore.
Credit Guarantee Scheme for Micro and Small Enterprise (CGTMSE)
CGTMSE scheme is launched by the Indian government to facilitate credit facility to the MSME units through a collateral-free credit facility. Small Industries Development Bank of India (SIDBI) and the MSME ministry together established a trust named Credit Guarantee Fund Trust for Micro and small enterprises in order to implement Credit guarantee schemes.
Udyog Aadhaar Memorandum
Udyog Aadhar Memorandum is one of the schemes launched by the Indian Government in which Aadhar card is a mandatory requirement. The benefit of registering under these schemes is that one can avail credit, loans and subsidies from the government. You can opt for registration in both the online and offline mode.
Zero Defect Zero Effect
Here, goods that are being manufactured for export have to comply with the standard so that they do not get rejected. Also, the products which are exported under this scheme are eligible for some rebates and concessions.
Quality Management Standards and Technology tools
Under this scheme, specific technology tools such as seminars, campaigns, and activities are performed to sensitise the business about the new technology.
Grievance Monitoring System
This scheme is launched by the government so that the business owners can address their grievances. With the help of this scheme, they can check the status of their complaints.
Credit linked Capital Subsidy Scheme
This is one of the MSME schemes launched by the government in which these micro, small and medium enterprises can directly visit the bank for the subsidies in case they want to upgrade their business with new technologies.
Entrepreneurship choice for Women
The MSME Sector of our country has launched this scheme, especially for the women who want to start their own business. Apart from this, the government also imparts credit, counselling, training and delivery techniques to these women so that they can operate and manage and expand their business efficiently.
The MSME ministry is working closely to encourage micro small and medium Enterprises engaged in the manufacturing and production. These MSME Schemes is an intiative by the government which helps the MSME Sector in expansion. Also, it makes the youth of our nation self dependent.