MSME Credit Card (ME‑Card) Scheme

If you're running a micro enterprise, you probably know how tough it can be to get timely credit from banks. The ME-Card Scheme is designed to address financial needs. It gives you a simple, reliable way to access working capital when you need it. Whether it's to manage day-to-day expenses or grab a growth opportunity, the ME-Card is here to support your business without the usual banking hassles.

What is the ME-Card Scheme?

The Scheme provides ME-Card which is a credit card specifically designed for MSMEs Businesses that are registered on the Udyam portal. The MSME can use the ME-Card to borrow up to ₹5 lakh. The MSME can use the ME-Card for buying raw materials, paying suppliers, managing daily expenses, paying employee salaries, and investing in business growth. The Govt plans to issue 1 million ME cards in the first year, ensuring that a large number of small businesses benefit from this initiative. The Scheme also provides credit guarantee cover for MSME up to ₹10 crore. 

Objectives of the ME-Card Scheme

• Provide micro enterprises with seamless access to formal credit.
• Encourage formalisation by linking credit availability to Udyam registration.
• Supports your business growth and working capital needs.
• Reduce dependence on informal credit sources.
• Increase scalability and technological adoption among MSMEs.

Key Features of the ME-Card Scheme

• The credit limit on the ME-Card is ₹5 lakh per business owner.
• Maturity period depends on the lending bank’s policy, but is typically aligned with short-term working capital cycles.
• Interest rates are determined by the issuing bank according to internal lending norms.
• The credit guarantee cover for micro and small enterprises has been doubled from ₹5 crore to ₹10 crore to encourage more lending.
• Loans under the ME-Card can be used for business-related expenses such as procurement, inventory, and operational costs.
• The scheme targets registered micro enterprises as per the updated MSME definition.
• Export-oriented MSMEs can avail of term loans up to ₹20 crore as part of extended support from the government.
• Processing fees on loan sanctions are as per individual bank policies.
• Businesses must be registered on the Udyam portal, have PAN and GST linked to the enterprise, and be formally recognised entities.

Financial Assistance Offered Under the ME-Card Scheme

Eligibility Criteria for the ME-Card Scheme for Micro Enterprises

Eligibility

• Your enterprise must be registered as a micro enterprise on the Udyam portal.
• Your annual turnover should not exceed ₹10 crore.
• Your investment in plant and machinery or equipment should not exceed ₹2.5 crore.
• Your business should be formally registered (proprietorship, partnership, private limited company, OPC, LLP, or equivalent).
• You must have valid PAN and GST numbers linked to your business.

Non-Eligibility

• Businesses not registered on the Udyam portal.
• Informal or unregistered ventures and sole proprietorships without MSME status.
• Enterprises classified as small enterprises with turnover between ₹10 to ₹100 crore & with investment between  ₹2.5 to  ₹25 crores
• Enterprises classified as medium enterprises with turnover between ₹100 to ₹500 crore & with investment between  ₹25 to  ₹125 crores
• Personal loans or credit cards for non-business purposes.
• Enterprises without PAN or GST linked to their business. 

Documents Required for the ME-Card Scheme

• Udyam registration certificate.
• PAN card of the enterprise.
• GST registration certificate.
• Aadhaar card of the proprietor or key partners.
• Business bank account details.
• Proof of business address.

How to Apply for the ME-Card Scheme

Step 1: Ensure your business is registered on the Udyam portal.

Step 2: Gather necessary documents such as Udyam registration, PAN, GST, Aadhaar, and bank details.

Step 3: Approach a bank or financial institution authorised to issue ME-Cards.

Step 4: Submit your application along with all required documents to the bank.

Step 5: The bank will evaluate your creditworthiness and process your application.

Step 6: Upon approval, you receive the ME-Card with a credit limit of ₹5 lakh, ready for business use.

Benefits of the ME-Card Scheme

• Easy Credit Access
  Get quick working capital without traditional, lengthy procedures.
• Increased Credit Confidence
  Enhanced credit guarantee encourages banks to lend more freely.
• Boost Business Growth
  Use credit for inventory, machinery, or emergency expenses.
• Support for Exporters
  Access higher-term loans facilitating international business.
• Formal Recognition
  Build credit history and business credibility through formal financial tools.

Real-World Examples of ME-Card Usage

• Micro manufacturing units purchasing raw materials.
• Small retail businesses managing inventory during peak seasons.
• Service providers meeting operational costs without a cash crunch.
• Export-oriented MSMEs investing in product development or market expansion.

Related Government Support Plans Linked with the ME-Card Scheme

Final Words

The ME-Card Scheme is a significant step towards simplifying credit for micro enterprises like yours. By offering a dedicated, easy-to-access credit line backed by government guarantees, it ensures your business can meet working capital needs without undue stress. Register on the Udyam portal, apply for the ME-Card, and take confidence in expanding your enterprise with assured financial support.