India’s Micro, Small, and Medium Enterprises (MSMEs) are the lifeblood of the economy. They account for over 30% of India’s GDP, contribute significantly to exports, and employ millions of people across the country. However, MSMEs often struggle with access to finance, technology upgrades, compliance, and visibility in competitive markets.
The Indian government has launched a wide array of schemes to address these challenges — from funding support to skill development, technology adoption, and export promotion. But with so many schemes across departments, MSMEs often don’t know where to begin.
To help you cut through the clutter, we’ve compiled a list of 5 high-impact schemes every MSME should know about in 2025 — especially if you’re looking to grow sustainably and competitively.
A. Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
Problem it solves: Lack of collateral. Getting a loan without security can feel like a far-off dream for small businesses. That’s where the CGTMSE scheme steps in.
What it offers:
- Collateral-free credit up to ₹2 crore
- Covers both working capital and term loans
- Available through banks, NBFCs, and regional rural banks
How it helps:
Even if you don’t have assets to offer as security, you can still access funding to expand, buy machinery, or handle day-to-day operations.
Pro Tip: Get your Udyam registration done first. Most banks will require it as part of eligibility.
B. Prime Minister’s Employment Generation Programme (PMEGP)
Problem it solves: Lack of capital for first-time entrepreneurs. The PMEGP scheme is ideal for new entrepreneurs looking to start a manufacturing or service business.
What it offers:
- Subsidy of 15% to 35% on project cost
- Maximum project cost: ₹50 lakh for manufacturing, ₹20 lakh for services
- Promoters must contribute only 5–10% margin money
Eligibility: Individuals above 18 years of age. Self-help groups, charitable trusts, and registered societies can also apply
How to apply: You can apply online via the KVIC Portal. The District Industries Centre (DIC) will help with processing and training.
Real impact: PMEGP has funded thousands of businesses in rural and semi-urban areas — especially women entrepreneurs, artisans, and youth.
C. MSME Sustainable (ZED) Certification
Problem it solves: Poor quality standards and inefficient processes. ZED (Zero Defect, Zero Effect) is a quality certification that helps MSMEs become globally competitive while being environmentally responsible.
What it offers:
- Bronze, Silver, Gold-level certifications
- Subsidies up to 80% on cost of certification and consultancy
- Access to government tenders that require quality compliance
- Preferred access to MSME Champions Scheme and procurement networks
How it helps:
ZED isn’t just about certification — it gives you a roadmap to improve efficiency, reduce waste, and increase customer satisfaction.
Pro Tip: Start with the ZED Bronze audit. It’s affordable, government-supported, and gives you a benchmark to improve from.
D. Pradhan Mantri Mudra Yojana (PMMY)
Purpose: Provides collateral-free loans to micro and small enterprises to promote entrepreneurship.
Key Features:
- Loans categorized into:
- Shishu: Up to ₹50,000
- Kishor: ₹50,001 to ₹5 lakh
- Tarun: ₹5,00,001 to ₹10 lakh
- No collateral required.
- Flexible repayment terms. jaankaarbharat.com+1egniol.co.in+1Kinara CapitalReuters+1Kinara Capital+1
Recent Updates:
Loan limits doubled to ₹20 lakh for entrepreneurs who have successfully repaid previous loans. Reuters
Eligibility: Non-corporate small business segments including proprietorships, partnerships, and small manufacturing units. jaankaarbharat.com
How to Apply: Through banks, NBFCs, and microfinance institutions
E. Technology and Quality Upgradation Scheme (TEQUP)
Problem it solves: Outdated tech and poor energy efficiency
This scheme is focused on helping MSMEs adopt energy-efficient technologies and reduce production costs.
What it offers:
- Capital subsidy up to 25% (max ₹10 lakh) for adopting green technologies
- Financial support for audits and tech implementation
- Support from energy service companies (ESCOs) for assessments
How it helps: If you’re in manufacturing, food processing, or textiles — this is your chance to modernize and cut costs in the long run.
Bonus: State-Level Schemes You Shouldn’t Miss
Apart from central schemes, many state governments offer their own incentives:
- Telangana: TS-iPASS for faster approvals, reimbursement of stamp duty, and power subsidy
- Goa: Startup support, rent reimbursement, innovation grants
- Maharashtra & Gujarat: Special subsidies for women-led MSMEs, export incentives, land allotment support
Stay updated via your state MSME department website or subscribe to the IRIS MSME newsletter for updates.
Conclusion
Government schemes are not just paperwork — they are powerful levers of growth. The key is knowing which ones to target and when to act.
Whether you’re just starting out or planning to scale, explore these 5 schemes today. And don’t forget — registering under Udyam and filing your GST regularly are essential to unlock most of these benefits.