Government Revises MSME Investment, Turnover Criteria, New Limits Effective from April 1

New Delhi, March 24, 2025 – The Ministry of Micro, Small, and Medium Enterprises (MSME) has officially announced new classification criteria, revising both investment and turnover limits. These changes were initially introduced in the Union Budget 2025, which will take effect on April 1, 2025.

Under the updated classification, the investment and turnover limits for Micro, Small, and Medium Enterprises have been significantly increased to reflect the evolving business landscape and promote growth within the sector. 

New MSME Classification Criteria 

– Micro Enterprises: 

  – Investment Limit: Increased from ₹1 crore to ₹2.5 crores 

  – Turnover Limit: Increased from ₹5 crores to ₹10 crores 

– Small Enterprises: 

  – Investment Limit: Increased from ₹10 crores to ₹25 crores 

  – Turnover Limit: Increased from ₹50 crores to ₹100 crores 

– Medium Enterprises: 

  – Investment Limit: Increased from ₹50 crores to ₹125 crores 

  – Turnover Limit: Increased from ₹250 crores to ₹500 crores  

The new limits are designed to enhance the competitiveness of MSMEs, allowing them to expand operations while continuing to benefit from the MSME framework. The government’s decision to increase investment limits by up to 2.5 times and double the turnover threshold aligns with its vision to promote industrial growth and encourage domestic production. 

These revised criteria were introduced following Finance Minister Nirmala Sitharaman’s announcement in the Budget 2025, where she highlighted the need to broaden MSME classification parameters to support India’s rapidly growing businesses. The updated limits are expected to ease compliance burdens, improve access to credit, and foster job creation across the manufacturing, services, and trading sectors.

Impact on MSMEs 

The revised classification will enable businesses to scale up operations without losing the advantages of being classified as an MSME. These changes will also facilitate easier access to government schemes, financial assistance, and subsidies, further strengthening the backbone of India’s economy.

With the new classification set to take effect on April 1, 2025, MSME owners are encouraged to review their eligibility under the updated criteria to continue availing themselves of benefits.