Ministry notified new norms of classification of MSME

  • Ministry of MSME gears up to implement the New Norms of classification of MSMEs
  • the upper ceiling for classification of MSMEs now has been raised
  • New definition and criterion notified; and will come into effect from 1st July, 2020
  • Exports will not be counted in turnover for any enterprises whether micro, small or medium
  • Detailed guidelines along with other clarifications and regulations being issued separately
  • Handholding mechanism named “Champions” in place to assist MSMEs

Key points of press release:

1. Ministry vide Gazette Id no. CG-DL-E-01062020 -219680 and S.O. 1702(E) has officially notified criteria for classification of micro, small and medium enterprise.

2. The new definition and criterion will come into effect from 1st July, 2020.

3. Revision in MSME definition was announced in the Atmnirbhar Bharat package on 13th May, 2020.

4. The Government of India on 01.06.2020 decided for further upward revision of the MSME Definition. For medium Enterprises, now it will be Rs. 50 Crore of investment and Rs. 250 Crore of turnover.

5. It has been decided to further increase the limit for medium Units. This has been done in order to be realistic with time and to establish an objective system of classification and to provide ease of doing business.

6. there will be no difference between manufacturing and service sectors. Also, a new criterion of turnover is added.

7. the provision of excluding the exports from counting of turnover will encourage the MSMEs to export more and more without fearing to loose the benefits of a MSME unit.

MSME Loan- Eligibility criteria, Process, Interest Procedure, Last date

Champions Portal for MSME

  • Ministry of MSME has reiterated that it has put in place a very strong handholding mechanism for MSMEs and new entrepreneurs in the name of Champions (
  • launched by the Prime Minister
  • Interested Enterprises/People can take benefit of this mechanism
  • can also put their queries or complaints.

New definitions “Enterprises” – already notified

(shall come into effect from 01.07.2020):

Micro enterpriseswhere the investment in Plant and Machinery or Equipment does not exceed one crore rupees and turnover does not exceed five crore rupees;
Small enterpriseswhere the investment in Plant and Machinery or Equipment does not exceed ten crore rupees and turnover does not exceed fifty crore rupees;
Medium enterpriseswhere the investment in Plant and Machinery or Equipment does notexceed fifty crore rupees and turnover does not exceed two hundred and fifty crore rupees
  • Kindly note that:

Detailed Guidelines and Clarifications as regards the classification in pursuance of the changed definition are being issued separately by the MSME Ministry.


The author of the above article is CS Lalit Rajput, Partner at Xcede Consultech LLP.
Email id: [email protected]

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