In Budget 2026, Finance Minister Nirmala Sitharaman unveiled a comprehensive plan to strengthen India’s micro, small, and medium enterprises (MSMEs).
Key Measures Announced in Budget 2026
Key measures include the Rs 10,000-crore SME Growth Fund, a Rs 2,000-crore top-up to the Self-Reliant India Fund, and TREDS reforms aimed at ensuring faster payments, easier credit access, and professional support.
These initiatives are designed to boost liquidity, encourage business expansion, and create resilient MSME champions, addressing long-standing challenges such as delayed payments, high borrowing costs, and limited equity access.
💼 Rs 10,000-Crore SME Growth Fund
- Fund Amount: Rs 10,000 crore
- Purpose: Equity support to high-potential MSMEs
- Objective: Help MSMEs scale up and expand
- Eligibility: MSMEs meeting performance criteria
- Additional Support: Rs 2,000-crore top-up to Self-Reliant India Fund
On February 1, Finance Minister Nirmala Sitharaman unveiled a Rs 10,000-crore SME Growth Fund, a Rs 2,000-crore top-up for the Self-Reliant India Fund, and comprehensive measures to facilitate liquidity and credit access as part of a three-pronged strategy to strengthen micro, small, and medium enterprises (MSMEs).
Equity Assistance and TREDS Reforms
Sitharaman said that the government will provide equity assistance to establish “SME champions” when he presented the Budget 2026. lessen the strain on operating capital and enhance MSME transactions’ payment discipline.
High-potential businesses would get equity assistance from the planned Rs 10,000-crore SME Growth Fund, which will reward MSMEs based on certain performance standards to aid in their expansion and scaling up.
In order to improve the fund-of-funds structure that supports MSMEs via equity involvement, the minister also announced a Rs 2,000-crore injection into the Self-Reliant India Fund.
Sitharaman said that all Central Public Sector Enterprises (CPSEs) would be required to adopt the Trade Receivables Discounting System (TREDS) as a price benchmark for MSMEs in order to alleviate liquidity difficulties and ensure quicker payments.
A specialized group of “Corporate Mitras” would help businesses with compliance, governance, and growth planning. The budget also suggests making it simpler for MSMEs to get loans.
The statements coincide with ongoing worries about late payments, expensive borrowing, and restricted access to equity for India’s MSME sector, which contributes significantly to exports and jobs.
⚡ TREDS Reforms & Corporate Mitras Support
- TREDS: Mandatory for all CPSEs interacting with MSMEs
- Purpose: Faster payments and liquidity improvement
- Corporate Mitras: Professional support for compliance, governance, and growth
- Credit Access: Easier financing for MSMEs
- Impact: Encourages sustainable MSME growth and resilience
Frequently Asked Questions
1. What is the Budget 2026’s SME Growth Fund?
A Rs 10,000-crore SME Growth Fund was unveiled by Finance Minister Nirmala Sitharaman to provide high-potential MSMEs equity assistance so they may grow and scale.
2. Why is the Self-Reliant India Fund receiving a top-up of Rs 2,000 crore?
By encouraging equity involvement to help MSMEs in finance and development efforts, the Rs 2,000-crore injection fortifies the fund-of-funds system.
3. How would MSMEs profit from TREDS reforms?
For MSMEs, the Trade Receivables Discounting System (TREDS) will serve as a price standard. In order to ensure quicker and more reliable payments, TREDS will be required for all Central Public Sector Enterprises (CPSEs) that interact with MSMEs.
4. What policies are being implemented for professional assistance and credit access?
In order to assist companies with compliance, governance, and development planning, the Budget suggests making it simpler for MSMEs to get financing and establishing a special cadre of Corporate Mitras.
5. What makes these changes important for the MSME sector in India?
Delays in payments, excessive borrowing prices, and restricted access to equity are some of the issues facing India’s MSME industry. By strengthening liquidity, enhancing working capital management, and promoting company expansion, these changes hope to boost employment and exports.
Conclusion
Through the Rs 10,000-crore SME Growth Fund, TREDS reforms, and equity assistance through the Self-Reliant India Fund, the Budget 2026 presents a comprehensive strategy to assist MSMEs.
The government hopes to develop resilient and scalable MSME champions by facilitating financing availability, guaranteeing quicker payments, and offering expert advice. This will increase employment, exports, and general economic development.
Disclaimer
This content is for informational purposes only and does not constitute financial advice. Readers should consult a qualified expert before making any investment decisions.
