New Definition of MSME (Micro, Small & Medium) enterprises based on Turnover and Investment

  • Admin
  • May 15,2020
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As per the first trench of reforms (AatmaNirbhar) given by Hon’ble Finance Minister of India on 13/05/2020, one of the reforms was to change the definition of MSME to widen the area of coverage for enterprises as given in table below:

Revised MSME Classification
For both Manufacturing and Service sector
Mix Criteria of Investment + Turnover
S. No. Classifiction Investment Amount Turnover Amount
1 Micro Enterprises Less than 1 Cr. Less than 5 Cr.
2 Small Enterprises Less than 10 Cr. Less than 50 Cr.
3 Medium Enterprises Less than 20 Cr. Less than 100 Cr.

 

Old MSME Classification
Single Criteria of Investment in Plant & Machinery
S. No. Classifiction Investment (Service Sector) Investment (Mfg. Sector)
1 Micro Enterprises Less than 10 Lacs Less than 25 Lacs
2 Small Enterprises Less than 2 Cr. Less than 5 Cr.
3 Medium Enterprises Less than 5 Cr. Less than 10 Cr.

 

Key Points:

  • Same criteria have been introduced for service & manufacturing sector’s MSME.
  • Now composite amount of turnover ‘+’ investments has to be seen for every enterprise; turnover amount has been newly introduced.
  • Criteria of MSME coverage has been widen, more entity can now cover under MSME.
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