India has been the land of the fastest growth and development over the past few decades. We have witnessed the glory of technology, businesses and developing regions nationwide. One of the key reasons for India's economic growth is the Micro, Small and Medium Enterprises. According to a recent report, on September 16, 2022, Minister Narayan Rane said that MSMEs have contributed one-third to India's gross domestic product and have the potential to grow further.
The government and financial institutions in the country are encouraging people to start businesses. By doing so, you will contribute to the country's overall growth and push India further up the ladder globally.
Before we take a look at the different MSME businesses in India, let's take a look at the criteria in terms of investment and annual turnover for a business to fall under the MSME sector:
|Category||Maximum Investment||Maximum Annual Turnover|
|Micro||Rs.1 crore||Rs.5 crore|
|Small||Rs.10 crore||Rs.50 crore|
|Medium||Rs.50 crore||Rs.250 crore|
So, if your business investment and turnover fall within this range, you are part of the benefits, schemes and other provisions for MSME in India.
The MSME sector is mainly divided into two categories: manufacturing and service. Let's take a look:
According to a recent report, MSMEs in India's GDP is expected to grow 100% by 2025. Businesses in the manufacturing sector mainly produce goods. The investment in plant and machinery and annual turnover also play a vital role in categorizing SME businesses under this category.
Here are some of the thriving manufacturing businesses under MSME in India:
|Oil, Gas, Coal||Electronic and Electrical Goods||Industrial Supplies|
|Industrial Engineering||Renewables and Environment||Food Processing|
|Packaging Material and Supplies||Agriculture and Farming||Medical and Healthcare Products|
|Automobile Parts and Spares||Chemicals||Khadi Products|
MSME businesses in these manufacturing industries have shown extreme potential and growth in India. Regarding the Khadi and Food processing industries, the Government of India has undertaken various initiatives to support and encourage SME businesses. The Ministry of MSME introduced the Scheme Fund for Regeneration of Traditional Industries (SFURTI) and the Prime Minister's Employment Generation Programme (PMEGP) to help and support MSME businesses flourish in the non-agriculture sector.
Government supports the business ideas and initiatives of the MSME sector. According to a report, the MSME Ministry also launched A Scheme for Promotion of Innovation, Rural Industry and Entrepreneurship (ASPIRE) to foster innovation and the creation of new businesses, including those engaged in food processing. By providing them with support for selling their products through Khadi & Village Industries Commission (KVIC) sales outlets, the Ministry of MSME is also helping micro industries market their agriculturally based products like papad, masala, jam, jelly, etc.
Some of the products the government has exclusively marked for manufacturing by the MSME industry are:
Food and Allied Industries
Groundnut Oil (except solvent extracted)
Mustard Oil (except solvent extracted)
Chemical and Chemical Products
Glass and Ceramics
Mechanical Products, excluding Transport Equipment
Steel chairs-All types
Steel tables-All other types
Steel furniture-All other types
Stainless steel utensils
Wood and Wooden Furniture
Wooden Furniture and Fixtures
According to a recent report, the Service sector contributes to 58% of India's GDP. The MSME industry makes up most of the service sector offerings. Some of the best business ideas to take inspiration from are in the services sector! Some of the popular SME services in India are:
|Food Catering||Small Restaurants||Appliances Stores|
|Beauty Parlour||Cloud Kitchens||Electronic Surveillance and Security|
|Food Vans||Crèches||Energy Efficient Pumps|
|Engineering and Fabrication||Furniture||IT Solution Provider|
|Laundry and Dry Cleaning||Multi Channels Dish Cable Antenna||Photo Studio|
|Consultancy Services||Rental and Leasing of equipment||Servicing of Agricultural Farm Equipment|
|Testing Labs for industries||Training and Educational Institution||Diagnostic Centers|
|Medical Clinics||Apparel Stores||Electronic Accessories|
|Repair and Restoration Work||Accounts||Fitness Centres|
The MSMEs have played a successful role in making life more convenient and products accessible to everyone. They have also been crucial in developing rural and semi-urban areas by providing employment opportunities and utilizing people's skills and raw resources. However, service sector MSMEs do face some challenges. One of the major challenges is the availability of working capital. To aid this situation, SMEs should move toward flexible and safe business loan options like Loan against Property. It provides many benefits, including longer repayment tenure and low interest rates.
Government Schemes for MSMEs in India
|Credit Guarantee Trust Fund for Micro & Small Enterprises (CGTMSE)||Established by the Ministry of MSME and Small Industries Development Bank of India (SIDBI) only for Micro and Small Enterprises|
|Prime Minister Employment Generation Programme (PMEGP)||Under this scheme, any new project in the manufacturing sector worth up to ₹ 25 lakhs and a new business/service sector worth up to ₹ 10 lakhs will get financial assistance.|
|Interest Subsidy Eligibility Certificate (ISEC)||For the promotion of Khadi and Village Industry products|
|Market Promotion & Development Scheme (MPDA)||For the promotion of Khadi and Village Crafts|
|Revamped Scheme of Fund for Regeneration of Traditional Industries (SFURTI)||This was established to improve traditional industries, emphasizing traditional skills, and ensuring long-term sustainable income for rural artisans|
|ZED Certification||Stands for Zero Defect and Zero Effect (ZED). It aims at reducing waste and improving productivity. All MSMEs with Udyog Aadhar are eligible|
|National Manufacturing Competitiveness Programme (NMCP)||To enhance competitiveness in the MSME sector to promote growth.|
|Entrepreneurship and Skill Development Programme (ESDP) Scheme||Encouraging entrepreneurship and growth of MSMEs in India|
The government has also introduced positive reforms for the MSME industry under Atma Nirbhar Abhiyan. Let's take a look:
Availability of Rs 3 lakh crore collateral-free and automatic loans
MSMEs can now enjoy Rs 20 crore subordinate debt
An infusion of Rs 50,000 crore was done through the MSME Fund of Funds
What are Other Loan Options Available?
A loan against property is not just a wonderful business loan option but also a smart one. Let's take a look at why a loan against property is the best option for SMEs:
You will get your loan processed faster
Loan against property interest rates is low
You can get up to 80% of your property value as a loan amount
You get a long repayment tenure
You can continue to use the property you have hypothecated for the loan
It's a secure loan option
Starting a business doesn't have to be a dream anymore! Take inspiration from the endless opportunities we have listed for you in the MSME industry. With a business loan like a loan against property, you can make your business dreams come true! Know more about the and the available.
Godrej Capital, through its subsidiaries, Godrej Housing Finance and Godrej Finance, offers products such as Home Loans, Loans Against Property, Balance Transfers, and many more. To know more about our offering, click
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