The Union Budget 2025-26 unveiled major measures to improve access to credit, with Finance Minister Nirmala Sitharaman announcing an increase in the Kisan Credit Card (KCC) loan limit from Rs 3 lakh to Rs 5 lakh. This move aims to support 7.7 crore farmers, fishermen and dairy farmers, ensuring timely financial aid for agricultural operations.
For Micro, Small, and Medium Enterprises (MSMEs), the government has enhanced investment and turnover limits to 2.5 times and 2 times, respectively, to facilitate business expansion and job creation. The credit guarantee coverage for micro and small enterprises has doubled from Rs 5 crore to Rs 10 crore, which is expected to generate Rs 1.5 lakh crore in additional credit over five years.
To bolster startups, the credit guarantee limit has been raised from Rs 10 crore to Rs 20 crore, with the guarantee fee moderated to 1 per cent for loans in 27 focus sectors under Aatmanirbhar Bharat.
Export-oriented MSMEs will now have access to term loans up to Rs 20 crore. Additionally, the government will introduce customised credit cards with a Rs 5 lakh limit for micro-enterprises registered on the Udyam portal.
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"For startups, from Rs 10 Crores to Rs 20 Crores with the guarantee fee being moderated to 1% for loans in 27 focus sectors which are important for Aatmanirbhar Bharat. For well-run exporter MSMEs, for term loans up to Rs 20 Crores. Also for the micro-enterprises, we will introduce customised credit cards with a Rs 5 Lakh limit for micro-enterprises registered on Udyam portal," FM Nirmala Sitharaman said in her Budget 2025 speech.
These measures aim to boost financial inclusion, support entrepreneurship and drive economic growth, reinforcing the government’s commitment to empowering key sectors of the economy.