Policies & Funding for MSMEs

In 2007, the Government of India set up a new branch called the Ministry of Micro, Small and Medium Enterprises. This ministry envisions a bright future for the MSME sector- they’d like to grow and develop the sector to their full potential. To do so, they’ve put in place various policies and methods of funding for all aspiring entrepreneurs and businessmen.


Headstart Indore covered Policies & Funding for MSMEs in their June 2020 edition of Startup Saturday. Mr. Sameer Sharma, CEO of Swaaha Resource Management and Ms. Anugya Handoo, Sr. Statistical Officer at MSME-DI, Indore, spoke at length about the various initiatives undertaken by the Government of India to help the sector grow.

Mr. Sharma began the session by saying that the Indian Government was extremely serious about startups. The government takes care of:

  1. Registration & Authorization
  2. Funding
  3. Procurement
  4. Certification

He recommended that all aspiring and existing businessmen and entrepreneurs refine their idea so that they are able to withstand the shift in the market. “Change your game plan”, he said before focusing on the global economic shift that we were facing right now. Mr. Sharma very simply explained the current scenario in three points:

  1. With the COVID-29 pandemic, China’s dominance in the market is being questioned.
  2. India has the potential to take over- we have the facilities and the manpower to do so.
  3. Our market is huge- if we’re able to strengthen online businesses and tweak business plans to best suit online platforms we’ll be able to cater to a lot more people.

Ms. Handoo then continued from where Mr. Sharma left off. She said that considering how technologically advanced we’d become- there was absolutely no way to stop the incoming flow of information. This leads to idea formation and development. Ms. Handoo then explained the difference between MSMEs and Startups with the former being a traditional business and nothing unique and the latter being filled with uniqueness and creativity.

She then spent a considerable amount of time talking about the flagship initiatives run by the government:

  • CHAMPIONS: It aims at Creation and Harmonious Application of Modern Processes for Increasing the Output and National Strength. They help grow small units through helping and handholding.
  • IP Facilitation Centre: They would like to enhance the competitiveness of the MSMEs and scheme “Building Awareness on Intellectual Property Rights (IPR)” for them.
  • MSME Samadhaan: It aims at empowering MSMEs across the country to register all their cases related to delay in payment to the Ministries & Departments under the Union Government as well as CPSEs and the State governments and their PSUs.
  • MSEFC (Micro & Small Enterprises Facilitation Council)
  • Udyog Aadhar Memorandum: Udyog Aadhaar is a twelve-digit Unique Identification Number provided by the Ministry of MSMEs.
  • PMEGP: Prime Minister’s Employment Generation Programme (PMEGP) is a credit-linked subsidy programme administered by the Ministry of MSMEs, Government of India.

On a closing note, both our speakers agreed on being indifferent to the situation- the pandemic should not affect your work. They advised all aspiring entrepreneurs and business owners to come up with a dynamic concept- one that was not only practical but also yielded good results.

Key Takeaways:

  •  “Zeal होता है startups में”, they have the ability to change as per the requirements of whatever is demanded by the market at that time.
  • Startups are going to be a saving grace for the Indian Market during the Global Economic Recession.

The session had great insights given by both speakers- not only were they practical in offering advice but they were very supportive of the audience’s future/present endeavours.

Contributed by:
Sanskriti Bhatnagar
Ecosystem Development Intern
Headstart Network Foundation