Union Budget 2025: A boost for the MSME segment, say industry experts

The Union Budget 2025 reflects a strategic push towards MSME growth. The increased credit guarantee cover for MSMEs, now raised to Rs 10 crore, and the enhancement of the loan limit for Kisan Credit Cards to Rs 5 lakh show the government’s commitment to financial inclusivity for farmers and enterprises. 

Many experts say that the budget rightly focuses on expanding financial support for MSMEs, a sector crucial in positioning India as a global manufacturing hub and responsible for 45 per cent of the nation’s exports. Budget 2025 broadens MSME eligibility, increasing turnover up to Rs 500 crore.

“Overall, the budget is a strong and stable one, a positive step towards India’s development goals—which is the need of the hour. The credit schemes for the MSME sector and startups, such as customised credit cards and a dedicated Rs 10,000 crore Fund of Funds, will be critical for deepening financial inclusion. However, the focus should now shift towards simplifying access to these schemes, particularly for businesses in tier 2 and 3 cities,” said Nirav Choksi, CEO and Co-Founder of CredAble. 

Experts point out that though different schemes are necessary for the upliftment of the MSMEs, how quickly and efficiently businesses can secure these funds will determine their true impact. Additionally, DPI-enabled export financing, combined with term loans of up to Rs 20 crore for well-run export-oriented MSMEs, will empower businesses to step into international markets. Providing the right means to scale would also include building manufacturing and export competitiveness through digital trade networks and strong buyer-supplier ecosystems,” added Ketan Mehta, the CFO of CredAble.

Experts point out that the MSMEs are rightfully the second engine of growth due to their huge export potential. “The classification limits for MSMEs have been enhanced. Credit access will be improved for micro-enterprises with customised credit cards. 

It has also provided some relief on tax rationalisation measures, like higher TDS thresholds, increased TCS limits on remittances under LRS, so as to reduce compliance burden and provide financial flexibility,” said Swapnil Aggarwal, Director, VSRK Capital.