MSME & Startups: Help and Guidance to Grow (Powered by StartupFlora)

India’s economic story has been shaped by millions of micro, small and medium enterprises (MSMEs) and an increasingly vibrant startup ecosystem.
MSMEs supply everyday goods and services, create jobs in rural and urban areas, and contribute roughly one-third of India’s GDP.
The Startup India initiative, launched in 2016, galvanised a new generation of entrepreneurs. By January 2025, over 1.59 lakh (159 k) startups had been recognised by the Department for Promotion of Industry and Internal Trade (DPIIT).
Together, MSMEs and startups are propelling growth and creating opportunities. This blog explores recent data on their numbers, contribution to GDP, growth trajectory, available schemes, remaining gaps, and the role of StartupFlora, a Jaipur-based consultancy that assists new businesses.

MSMEs and Startups in India: Latest Numbers and Their Role in GDP Growth

How MSMEs and Startups Are Growing in India

Growth of MSMEs

• Formalisation & Digital Entry:
  Udyam Registration has transformed informal enterprises into formal entities, enabling access to credit, subsidies, and tenders.
• Employment Engine:
  MSMEs generated 11 million new jobs between 2023 and 2024, becoming the second-largest employment generator after agriculture.
• Exports Surge:
  MSME exports grew from ₹3.95 lakh crore (FY 2020-21) to ₹12.39 lakh crore (FY 2024-25).
• Improved Credit Access:
  MSME lending surpassed ₹35.2 lakh crore in March 2025, boosted by schemes like CGTMSE and ECLGS.
• Challenges Remain:
  Persistent credit gaps (micro enterprises receive only 16 % of MSME loans), tech adoption barriers, and delayed payments hinder growth.

Growth of Startups

• Rapid Increase:
  Recognised startups grew from 500 in 2016 to 1.80 lakh by mid-2025.
• Job Creation & Sector Diversity:
  Over 1.66 million direct jobs created across fintech, edtech, health-tech, e-commerce, and agritech sectors.
• Economic Impact:
  Startups contributed to India’s 8.2 % GDP growth through innovation and digital transformation.
• Supportive Policies:
  The Startup India Seed Fund Scheme, Fund of Funds for Startups, and Credit Guarantee Scheme for Startups have together channelled more than ₹23,000 crore into 1,000 + ventures.

Beneficial Government Schemes and Missed Opportunities

Key Schemes

• Pradhan Mantri MUDRA Yojana (PMMY): Collateral-free loans up to ₹20 lakh. Disbursal exceeds ₹20 lakh crore (2021-25).
• Stand-Up India: Supports women and SC/ST entrepreneurs; ₹57,000 crore in outstanding loans as of Dec 2024.
• PM Employment Generation Programme (PMEGP): Created 7 lakh jobs in FY 2023-24 with ₹3,000 crore margin support.
• RAMP Programme: ₹6,000 crore initiative for technology and capacity building.
• CGTMSE: Collateral-free loans with ₹9.34 lakh crore coverage for over 1.15 crore loans.
• Startup India Seed Fund and FFS: Thousands of startups funded through AIFs and incubators.

Opportunities & Gaps

• Awareness Deficit: 73 % of MSMEs remain unaware of government credit schemes.
• Registration Hesitancy: 35 % of enterprises still avoid Udyam registration due to low awareness.
• Credit Gaps: Micro enterprises get only 16 % of total MSME credit.
• Technology Adoption: Limited digital skills and infrastructure restrict growth.
• Delayed Payments: Cash flow issues continue despite initiatives like TReDS and GeM.
• Women-Led Enterprises: Nearly 87,000 startups have a woman founder – a promising but still under-represented segment.

Suggestions for Entrepreneurs

• Register on Udyam Portal for credit and procurement benefits.
• Use digital platforms like UPI, ONDC and TReDS for payments and supply-chain efficiency.
• Apply for sector-specific schemes such as RAMP, SISFS and PM Vishwakarma.
• Focus on technology and skill training to stay competitive.
• Partner with incubators and accelerators for mentorship and funding.

How StartupFlora Helps & Guides Startups and MSMEs

StartupFlora, based in Jaipur, is a private consultancy that guide entrepreneurs formalise their business, secure funding and stay compliant.

1. Registration and Certification Support
Assists with incorporation, Startup India certification and statutory registrations. Over 5,000 startups have reportedly received certification within seven days.

2. Funding Assistance
Offers guidance on bank loans and grants, claiming ₹100 crore disbursed to 1,000 + businesses, with a 92 % success rate at interview stage.

3. Tax and Compliance Help
Supports businesses with three-year tax holiday applications and regulatory compliance management.

4. Marketing and Growth Advisory
Provides branding, digital marketing, and connections with national incubation centres for scaling support.

Transparency Disclaimer: StartupFlora is a private consultancy and not affiliated with any government body. Entrepreneurs should always verify credentials and payment channels before engagement.

Q1. How many MSMEs are there in India in 2025?
Over 7.34 crore MSMEs are operating across India as of 2025.

Q2. How many startups are recognised in India?
Around 1.80 lakh startups are officially recognised under Startup India.

Q3. What is the GDP contribution of MSMEs?
MSMEs contribute about 30% to India’s total GDP.

Q4. Which schemes help MSMEs and startups in 2025?
Key schemes include PMEGP, MUDRA, RAMP, SISFS, and CGTMSE.

Q5. How do MSMEs help India’s economy?
They generate jobs, boost exports, and strengthen rural industrialisation.

Q6. What is StartupFlora’s role for MSMEs and startups?
StartupFlora helps with registration, funding, compliance, and growth guidance.

Q7. Can I get a loan without collateral under MSME schemes?
Yes, schemes like CGTMSE and MUDRA offer collateral-free loans.

Q8. Which ministry manages Startup India?
It is managed by the Department for Promotion of Industry and Internal Trade (DPIIT).

Q9. What benefits do startups get from the government?
They get tax holidays, funding access, and easier compliance under Startup India.

Q10. How can I register my business as a startup or MSME?
You can register through the official Udyam or Startup India portal.

Conclusion

MSMEs and startups form the backbone of India’s economy driving employment, innovation and exports. With over 7.34 crore MSMEs and 1.80 lakh recognised startups, India has emerged as the world’s third-largest startup hub. Government schemes like MUDRA, PMEGP, RAMP and SISFS have created a supportive ecosystem, but awareness and credit gaps remain.

StartupFlora acts as a trusted consultant helping businesses navigate registrations, funding and compliance – simplifying the journey from idea to enterprise. With formalisation, digital adoption and strategic guidance, India’s entrepreneurs can unlock limitless growth opportunities and continue powering the nation’s economic future.