To strengthen support for aspiring entrepreneurs, Union Finance Minister announced an increase in the loan limit to Rs 20 lakh during the Union Budget 2024-25 on July 23, 2024. This new limit took effect on October 24, 2024. These loans are extended through Banks, NBFCs, MFIs, and other financial institutions.

The newly announced loan category, Tarun Plus, is designed specifically for those who have previously availed and successfully repaid loans under the Tarun category, allowing them to access funding between Rs 10 lakh and Rs 20 lakh. Additionally, the Credit Guarantee Fund for Micro Units (CGFMU) will now provide guarantee coverage for these enhanced loans, further reinforcing the government’s commitment to nurturing a robust entrepreneurial ecosystem in India.

Micro, Small, and Medium Enterprises (MSMEs) play a vital role as ancillary units, complementing large industries and significantly contributing to the country’s inclusive industrial growth. These enterprises are continually expanding their presence across various sectors of the economy, offering a diverse array of products and services to meet both domestic and international market demands.

The availability of credit for MSMEs has seen consistent growth, driven by advancements in technology and data-driven lending practices. A notable government initiative supporting MSMEs’ access to credit is the Pradhan Mantri MUDRA Yojana, aptly described as a scheme dedicated to “Funding the Unfunded”.

Since 2015, Rs 11.58 lakh crore worth of MUDRA loans have been sanctioned to various marginalised communities belonging to Scheduled Castes, Scheduled Tribes and  OBCs  realising PM's mantra of 'Sabka Saath, Sabka Vikas, Sabka Vishwas and Sabka Prayaas'”