CAIIB · BRBL · Chapter 16

THE MICRO SMALL and Medium Enterprises Development ACT 2006

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Banking Regulations and Business Laws — CAIIB.

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Q

What percentage of national GDP do MSMEs contribute?

A

Approximately 30% of national GDP.

Q

Which Act governed small-scale sector before 2006?

A

Industries (Development and Regulation) Act, 1951 (IDRA) and SSI regime.

Q

When did MSMED Act, 2006 come into force?

A

2nd October 2006.

Q

What major change occurred on 13 May 2020 to MSME classification?

A

Composite criteria of investment AND turnover introduced; unified thresholds.

Q

When were MSME investment and turnover limits enhanced 2.5x and 2x respectively?

A

1 April 2025, under Union Budget 2025-26 revision.

Q

How many chapters does MSMED Act contain?

A

6 chapters (plus Chapter IIIA for Udyam Registration).

Q

What are the two broad enterprise classes under Sec. 7?

A

Manufacturing enterprises and Service enterprises.

Q

How many members does National Board for MSMEs normally have?

A

47 members, of which 18 are ex-officio.

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