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As the Government of India marches towards shaping the new journey of Viksit Bharat with the Union Budget 2025-26, there are some exciting announcements for the small and medium-sized businesses and startups in India. Recognizing these businesses as an important aspect in driving growth, innovation, and employability, the government has brought in several initiatives to enhance credit access, digitalization, and support entrepreneurship.
Firstly, the credit guarantee scheme for Micro and Small Enterprises has been expanded in the recent budget. And, that means, now businesses will get a cover of up to INR 10 crore to scale up their operations.
A new scheme called ‘Customized credit cards’ was also introduced with a limit of INR 5 lakh for micro-enterprises registered on the Udhyam portal. This scheme promises to bring them easy access to working capital and reduce their dependency on informal lending sources.
The investment and turnover limits for MSME classification have also been revised, and it is expected it is going to allow many more businesses to benefit from various government schemes and incentives.
Adding to the development of startups, a fund of INR 10,000 crore was introduced in the budget to support investments across various startups sectors and growth stages. Along with that, the credit guarantee cover for startups has increased to INR 20 crore. These assistances will encourage financial institutions to lend more money and research-driven and high-impact technology startups could benefit from the Deep Tech Fund of Funds to promote next-generation startups working in areas such as artificial intelligence (AI), machine learning (ML), and biotechnology.
Furthermore, initiatives like skill development programs for a skilled workforce, digital transformation for enhanced MSME competitiveness, and term loans of up to INR 2 crore for first-time women, SC and ST entrepreneurs have been added.
With this unparalleled combination of financial support, policy enhancement, and technological advancements the government is dotting on creating and entrepreneurial ecosystem. These sectors are expected to become even more significant contributors to India’s economic growth in upcoming future.
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