Udyamee, Ahmedabad:
In a significant move to bolster the Micro, Small, and Medium Enterprises (MSME) sector, the Union Budget 2025, presented by Finance Minister Nirmala Sitharaman on February 1, introduced the ‘ME-Card’—a customized credit card scheme tailored for micro enterprises registered on the Udyam portal.
Industry experts have lauded the ME-Card initiative and termed it a “game changer” for micro enterprises, emphasizing that it will ease working capital constraints and boost financial accessibility.
The FM further stated in her speech that there are over 1 crore registered MSMEs, employing 7.5 crore people currently. They are contributing in generating 36% of the nation’s manufacturing. These MSMEs have positioned India as a global manufacturing hub, with 45% of our exports coming from them.
Key Features of the ME-Card:
- Credit Limit: Each ME-Card offers a credit limit of ₹5 lakh, providing micro enterprises with accessible funds to manage their working capital needs.
- Eligibility: The scheme is exclusively available to micro enterprises registered on the Udyam portal, ensuring that formalized businesses benefit from this initiative.
- Issuance Plan: In its inaugural year, the government plans to issue 10 lakh such credit cards, aiming for widespread impact across the micro-enterprise sector.
Benefits:
- Enhanced Credit Access: The ME-Card is designed to simplify the credit acquisition process for micro enterprises, reducing reliance on traditional collateral-based loans.
- Operational Flexibility: With readily available credit, businesses can manage cash flows more effectively, invest in inventory, and respond promptly to market demands.
- Formalization Incentive: By linking the credit card to Udyam registration, the scheme encourages informal businesses to formalize their operations to avail of these benefits.
How to Use?
The ME-Card functions similarly to conventional credit cards but is tailored for business expenditures. Cardholders can use it to purchase raw materials, pay for services, or cover other operational expenses. Repayments can be managed through scheduled payments, and responsible usage can help build the enterprise’s creditworthiness, potentially leading to higher credit limits in the future.
The ME-Card represents a strategic effort by the government to empower micro enterprises, fostering their growth and integration into the formal economy. As the scheme rolls out, its impact on the MSME sector will be closely monitored, with expectations of enhanced economic activity and job creation.
