Introduction

The Ministry of Micro, Small and Medium Enterprises (MSME) has significantly revised the investment and turnover thresholds for MSME classification. The changes have been notified vide Notification S.O. 1364(E) dated 21 March 2025. This amendment supersedes the earlier notification S.O. 2119(E) dated 26 June 2020, issued under the Micro, Small and Medium Enterprises Development Act, 2006.

Key Changes

The Notification increases the investment and turnover limits for MSMEs. The revised thresholds for MSME are as follows:

Enterprise Category	Revised Investment Limit	Revised Turnover Limit
Micro Enterprises	Increased from ₹ 1 crore to ₹ 2.5 crore	Increased from ₹5 crore to ₹10 crore
Small Enterprises	Increased from ₹10 crore to ₹25 crore	Increased from ₹50 crore to ₹100 crore
Medium Enterprises	Increased from ₹50 crore to ₹125 crore	Increased from ₹250 crore to ₹500 crore

Effective Date

The revised thresholds shall come into force from 1 April 2025.

MHCO Comment

The upward revision of thresholds is a welcome move and is expected to benefit a larger number of enterprises, particularly those in the growth stage who were previously at the cusp of losing MSME status due to marginal increases in investment or turnover. With broader criteria, more enterprises will now be eligible for MSME-related incentives such as easier access to credit, priority sector lending, subsidies, and various support schemes offered by the central and state governments.

This update was released on 24 Mar 2025.

The views expressed in this update are personal and should not be construed as any legal advice. Please contact us directly on +91 22 40565252 or legalupdates@mhcolaw.com for any assistance.

Legal Update Team
MANSUKHLAL HIRALAL & COMPANY
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