Date: 2026-02-01Category: Press ReleaseState: Union GovernmentCountry: India
FINANCE MINISTER NIRMALA SITHARAMAN INTRODUCES A DEDICATED ₹10,000 CRORE SME GROWTH FUND, TO CREATE FUTURE CHAMPIONS, INCENTIVIZING ENTERPRISES BASED ON SELECT CRITERIA
**Executive Summary**
The Finance Minister introduced a ₹10,000 crore SME Growth Fund to create future champions, incentivizing enterprises based on select criteria. As part of the Union Budget 2026-27, four measures were proposed to enhance liquidity support to MSMEs through the TReDS platform. A three-pronged approach has been proposed to help MSMEs grow. The release date is February 1, 2026.
**Key Points / Main Content**
* **Equity Support:**
* Introduction of a ₹10,000 crore SME Growth Fund to create future champions, incentivizing enterprises based on select criteria.
* Top-up of ₹2,000 crore to the Self-Reliant India Fund set up in 2021 to support micro enterprises.
* **Liquidity Support (via TReDS):**
* Mandating TReDS as the transaction settlement platform for all purchases from MSMEs by CPSEs.
* Introducing a credit guarantee support mechanism through CGTMSE for invoice discounting on the TReDS platform.
* Linking GeM with TReDS for information sharing with financiers about government purchases from MSMEs.
* Introducing TReDS receivables as asset-backed securities to develop a secondary market.
* **Professional Support:**
* Facilitating professional institutions (ICAI, ICSI, ICMAI) to design short-term, modular courses and practical tools.
* Creation of a cadre of ‘Corporate Mitras’, especially in Tier-II and Tier-III towns.
**Impact Analysis**
**MSMEs**
* **Impact:** MSMEs will benefit from increased access to equity and liquidity, and professional support to meet compliance requirements.
* **Action Required:** MSMEs should explore the opportunities provided by the SME Growth Fund, the TReDS platform, and the professional support initiatives.
**CPSEs and Corporates**
* **Impact:** CPSEs and other corporates will need to use the TReDS platform for all purchases from MSMEs.
* **Action Required:** CPSEs and other corporates need to adopt TReDS as the transaction settlement platform.
**Professional Institutions (ICAI, ICSI, ICMAI)**
* **Impact:** Professional institutions will be involved in designing and delivering short-term, modular courses for the 'Corporate Mitras' program.
* **Action Required:** Professional institutions need to create short-term, modular courses and tools to develop the cadre of ‘Corporate Mitras'.
**Financiers**
* **Impact:** Financiers will have access to information about government purchases from MSMEs through the link between GeM and TReDS.
* **Action Required:** Financiers can leverage the GeM and TReDS link to offer cheaper and quicker financing to MSMEs.
Key Entities Referenced
SME Growth Fund: A dedicated ₹10,000 crore fund to create future Champions, incentivizing enterprises based on select criteria.
TReDS: Trade Receivables Discounting System, for liquidity support to MSMEs.
Ministry of Finance: The Indian Government ministry responsible for financial matters.
CGTMSE: Credit Guarantee Fund Trust for Micro and Small Enterprises; to introduce a credit guarantee support mechanism through CGTMSE for invoice discounting on TReDS platform.
GeM: Government e-Marketplace; to link GeM with TReDS for sharing information with financiers about government purchases from MSMEs.
Ministry of Finance
FINANCE MINISTER NIRMALA SITHARAMAN
INTRODUCES A DEDICATED ₹10,000 CRORE
SME GROWTH FUND, TO CREATE FUTURE
CHAMPIONS, INCENTIVIZING ENTERPRISES
BASED ON SELECT CRITERIA
UNION BUDGET PROPOSES 4 MEASURES TO LEVERAGE
FULL POTENTIAL OF TReDS FOR LIQUIDITY SUPPORT TO
MSMEs
प्रव तथ: 01 FEB 2026 1:00PM by PIB Delhi
Union Minister of Finance & Corporate Affairs, Smt. Nirmala Sitharaman said that the Government led by
Prime Minister Narendra Modi, has decisively and consistently chosen action over ambivalence, reform
over rhetoric and people over populism.
While presenting the Union Budget 2026-27 in Parliament today, she said that the Government is inspired
by 3 kartavya, out of which the first kartavya is to accelerate and sustain economic growth, by enhancing
productivity and competitiveness, and building resilience to volatile global dynamics.
Recognising MSMEs as a vital engine of growth, the Finance Minister proposed a three-pronged approach
to help them grow as Champions under the first Kartavya.
First is the Equity support in which, she introduced a dedicated ₹10,000 crore SME Growth Fund, to
create future Champions, incentivizing enterprises based on select criteria. She also proposed to top up the
Self-Reliant India Fund set up in 2021, with ₹2,000 crore to continue support to micro enterprises and
maintain their access to risk capital.
On the second approach of Liquidity support, the Finance Minister said that with TReDS, more than ₹7
lakh crore has been made available to MSMEs. To leverage its full potential, she proposed 4 measures: (i)
mandate TReDS as the transaction settlement platform for all purchases from MSMEs by CPSEs, serving
as a benchmark for other corporates; (ii) introduce a credit guarantee support mechanism through
CGTMSE for invoice discounting on TReDS platform; (iii) link GeM with TReDS for sharing information
with financiers about government purchases from MSMEs, encouraging cheaper and quicker financing;
(iv) introduce TReDS receivables as asset-backed securities, helping develop a secondary market,
enhancing liquidity and settlement of transactions.
On the final approach of Professional support, Smt.Nirmala Sitharaman pointed out that the
Government will facilitate Professional Institutions such as ICAI, ICSI, ICMAI to design short-term,
modular courses and practical tools to develop a cadre of ‘Corporate Mitras’, especially in Tier-II andTier-III towns. These accredited para-professionals will help MSMEs meet compliance requirements at
affordable costs.
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NB/GDH
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