Micro, Small & Medium Enterprises as per the provision of Micro, Small & Medium Enterprises Development (MSMED) Act, 2006 are classified under two categories, one is the Manufacturing Enterprises and the other being the Service Enterprises. The enterprises which are manufacture/production, processing/preservation of goods consists of:

1. A microenterprise is where the investment that is in plant and machinery keeps within the amount Rs. 25 lakh.
2. A small enterprise, on the other hand, is the one where the investment in plant and machinery is greater than Rs. 25 lakh and less than Rs. 5 crores.
3. A medium enterprise is the one where the investment in plant and machinery is greater than Rs.5 crore and less than Rs.10 crore.
4. The enterprises which fall under the Service Enterprises consists of:
1. A microenterprise where the investment in equipment is not more than Rs.10 lakh.
2. A small enterprise is one where the investment in equipment is more than Rs.10 lakh but is less than Rs. 2 crores.
3. A medium enterprise is where the investment in equipment is more than Rs. 2 crores and is less than Rs. 5 crores.

Now, MSMEs is based on the annual turnover instead of being based on the investment in plant and machinery/equipment after the changes being approved in February 2018, by the Union Cabinet chaired by the Prime Minister Shri Narendra Modi. As per the new definition of MSME, the manufacturing sector includes: 

1. A microenterprise with its annual turnover being less than 5 crores. 
2. A small enterprise with an annual turnover between the Rs. 5 Crores to Rs. 75 crores.
3. A medium enterprise with an annual turnover between Rs. 75 Crores to Rs. 250 crores.
4. As per the new definition of MSME, the service sector includes: 
1. A microenterprise with its annual turnover being less than 5 crores. 
2. A small enterprise with an annual turnover between the Rs. 5 Crores to Rs. 75 crores.
3. A medium enterprise with an annual turnover between Rs. 75 Crores to Rs. 250 crores.

The Contribution of MSME

MSME contributes to large chunks and in many ways to help and support various sectors of the country. Being one of the vigorous and dynamic sectors of the Indian Economy, it plays a huge role in providing a number of employment opportunities and at a lower capital cost than the large industries. The hand of MSMEs in the industrialization of rural and backward areas acts in providing basic and equal provisions in the health and monetary matters. Not just this, MSMEs are a great provider of development in the socio-economic sector of the country as well. It basically is a contributor in the financial sector, growth in basic needs and monetary challenges, helps in diminishing poverty at a great scale by providing a whole new method of employment.  MSMEs are simply the pillars that help and support the Indian Economy in bringing the wave of innovation with great in the employment sector. 

The various issues faced by the MSMEs

There are a few shortcomings of the MSMEs but some are faced majorly by the new and upcoming MSMEs. Though being one of the greatest helping hands in the economic sector of the country, certain government departments, banks, corporates lag behind in helping and working along with the MSMEs and making them face issues in certain sectors. There are a number of shortcomings for MSMEs and they are as follows:

1. As it is a fact that most investors keep themselves away from risks, they often do not invest in small companies that lead the issue of the Equity capital leaving it with limited access. The reason behind this is that most of the investors do not risk investing in unknown/small companies.
2. Due to a lack of capital and various other reasons, there is a lack and limitation of market access for MSMEs.
3. The High-interest rates charged and collateral requirements by banks have not even left the MSMEs alone. 
   
4. One of the serious and major issues is the lack of usage and access to the updated and latest technology. It lags the MSMEs behind in the race of competitiveness and on the scale of growth, making it a slanting angle leading to a pit.  
   
5. A company under the MSME sector has been virtually denied with the revival mechanism, therefore denying it a step towards growth and innovation.
   
6. As the technology drags the MSME behind, the lack of marketing and procurement of raw materials along with the lack of marketing information, awareness, and financial assistance keeps the MSME always behind the line of perfect success.
   
7. As they are a bit dragged into the dark when it comes to advertisement and sales promotion, they are weaker in the parts as to that of MNCs. 
   
8. Their inability to access the raw material and resources makes it a problem in delivering the processed product/service on time.
   
9. The laws and regulations when it comes to the manufacturing and services aspects are a bit complex and difficult to find. As a number of decisions of a particular company/factory depend on the commissioner and inspector, it makes it easier to get into the chance of getting a red tape in the operation of MSME’S.
   
10. The inability to get the right financial assistance and banking services at the right time makes it difficult to reach the goal at the desired time. 
    
11. Also, the Non-availability of skilled labour that too at an affordable cost also is an issue faced by the MSMEs. 
    

MSMEs are not far from home when it comes to knowledge, resources, technology, and opportunities. All it needs is to inform them and help them access the resources to reach greater heights.  As they are growing rapidly in the market, a little push would only add as an advanced resource in helping the Indian Economic sector. The growth in the number of entrepreneurs is a deal of greater good within the digital age and it will only help the sector grow in various forms. In order to help and support the MSMEs in perspective to the changes which can make them dodge the ever consistent issues, the Chamber has developed important procedures to promote and support the SME sector. 

The role of the Chamber is to embrace innovative and modern ideas to help in the growth of the business and to attract a great number of good clientele. The purpose of the Chamber is to organize Seminars, Conferences, Workshops and Training Programs and other trade promotional activities to simply educate & create awareness amongst the SMEs. MSME has taken a step forward with organizing and working on several activities to enable and educate the SME Sector by arranging various trade promotional activities.