₹5,000 Crore Credit Support under MUDRA Scheme to Boost MSME Liquidity, Ease Financing Burden

Micro, Small and Medium Enterprises (MSMEs) account for 48% of India's exports and non-farm jobs. In an effort to bolster capital supply to these crucial sectors, the Cabinet recently approved an additional ₹5,000 crore in credit support under the MUDRA Scheme, according to Dr. Vijay Kalantri, President of the All India Association of Industries and Chairman of MVIRDC World Trade Centre Mumbai.

This move according to Dr. Kalantri is a significant step towards addressing MSMEs' financial needs, aiding their growth, expansion, and export potential. He further emphasized that given the MSME sector's substantial contribution to India's economic growth and exports, similar initiatives should be expanded over the next three years.

This would help India achieve its target of becoming a USD 5 trillion economy by 2030 and reach the goal of crossing USD 1 trillion in exports under the vision of Viksit Bharat. Dr. Kalantri also noted that a reduction in processing fees from 1% to 0.75% would further alleviate the borrowing costs for MSMEs, making credit more affordable and improving their competitiveness.

He added that the government should also consider extending concessional lending facilities to MSMEs, similar to those available in the housing sector. Access to affordable finance, he said, is essential for strengthening the MSME ecosystem, fostering entrepreneurship, generating employment, and enhancing India's global competitiveness.