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MSME Benefits under Aatma Nibhar Bharat Package

CA Rahul Mittal , Last updated: 05 June 2020  

MSME stands for Micro, Small and Medium Enterprises. In a developing country like India, MSME industries are the backbone of the economy.


  • Interim measures such as liquidity infusion and direct cash transfers for the poor.
  • long-term reforms in growth-critical sectors to make them globally competitive and attractive.
MSME Benefits under Aatma Nibhar Bharat Package

Decisions taken by Govt. for the growth of MSME Sector under the ATMA- NIRBHAR BHARAT ABHIYAN


1. Collateral Free Loans

  • Rs. 3 Lakh crores to collateral free automatic loans for businesses, including MSMEs
  • This scheme is implemented by Department of Financial Services.
  • Borrowers with upto Rs. 25 Cr. Outstanding and Rs. 100 Cr. Turnover eligible.
  • Loans to have 4 year tenor.
  • 12 months moratorium on principal repayment.
  • Interest to be capped.
  • Interest rate 9.25% to 9.75% from banks
  • Interest rate 14% from NBFCs.
  • 100%  credit guarantee cover to banks and NBFCs on principal.
  • Scheme can be availed till 31st Oct, 2020.
  • All businesses/MSMEs are eligible

How to Apply?

  • Through Banks, DFS and National Credit Guarantee Trustee Company Ltd (NCGTC)

2. Debt for Stressed MSMEs

  • Rs. 20,000 crores subordinate Debt for stressed MSMEs
  • Functioning MSMEs which are NPA or are stressed will be eligible
  • Govt will provide a support of Rs. 4000 crore to CGTMSE
  • CGTMSE will provide partial credit Guarantee support to Banks
  • Promoters of the MSME will be given debt by banks, which will then be infused by promoter as equity in the unit.

3. Equity Infusion For MSMEs 

  •  Rs. 50,000 crores equity infusion for MSMEs through Fund of Funds
  • Will provide equity funding for MSMEs with growth potential and viability
  • Funds of fund will be operated through a Mother Fund and few daughter funds
  • Will help to expand MSME size & capacity , encourage MSMEs to get listed on main board of Stock Exchanges.

How to Apply?

  • Through investor funds on boarded and registered with proposed Fund of funds

4. New Definition of MSMEs

  • Distinction between manufacturing and service sector to be eliminated
  • Composite criteria: Annual Turnover and Investment for manufacturing & service sector
  • Micro: Investment < Rs. 1 cr. and Turnover < Rs. 5 cr.
  • Small: Investment < Rs. 10 cr. and Turnover < Rs. 50 cr.
  • Medium: Investment < Rs. 50 cr. and Turnover < Rs. 250 cr.

5. Global Tenders to be disallowed upto Rs. 200 cr.

  • Global Tenders will be disallowed in government procurement tenders upto Rs. 200 cr.
  • This will be a step towards self-Reliant India and support Make In India.
  • This will help MSMEs to increase their business.
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