Micro, Small and Medium Enterprises Development Act, 2006
The Micro, Small and Medium Enterprises Development Act, 2006 is an Act of the Parliament of India. According to the act, "any buyer who fails to make payment to MSMEs, as per agreed terms or a maximum of 45 days, would be liable to pay monthly compounded interest at three times the bank rate notified by RBI".
Industries are divided into 2 categories. Manufacturing and services. They are further divided into micro, small and medium. In manufacturing sector, micro industries' capital requirements are under 25 lakh rupees. Small industries' are from 25 to 500 lakhs and medium industries' are 500 to 1000 lakhs. In services sector, micro industries' capital requirements are under 10 lakh rupees. Small industries' are from 10 to 200 lakhs and medium industries' are 200 to 500 lakhs.
