Budget 2026 Should Prioritise MSME Credit, Compliance And Digital Adoption: Deloitte Report

New Delhi, Nov 29 (KNN) Deloitte India has called for focused Budget 2026 interventions to bridge MSME gaps in credit access, digital adoption and compliance, warning that the sector remains vulnerable amid global trade volatility.

In its Budget Expectations report, Deloitte said schemes such as Raising and Accelerating MSME Performance (RAMP), Zero Defect Zero Effect (ZED), LEAN, Trade Receivables Discounting System (TReDS) and Government e-Marketplace (GeM), but MSMEs still face challenges in technology adoption, quality standards and scalability. 

It urged district-level training on e-invoicing, digital record-keeping and compliance with the Bureau of Indian Standards (BIS) and Food Safety and Standards Authority of India (FSSAI) norms, along with subsidised onboarding for TReDS, GeM and Open Network for Digital Commerce (ONDC).

Given the sector’s contribution of nearly 30 percent to GDP and 45 percent to exports, Deloitte said the upcoming budget is an opportunity to address last-mile challenges that hinder formalisation and value chain integration.

The consultancy said credit shortages are the sector’s biggest constraint and recommended a green-channel approval system in banks, a dedicated MSME liquidity and growth fund via Non-Banking Financial Companies (NBFCs) and fintechs, and integration of TReDS with GST systems to enable cash-flow-based lending.

To help micro units scale, Deloitte proposed structured graduation pathways supported by district transformation cells and corporate mentor networks. It also suggested GST 2.0 reforms, including refunds of input tax credit on services and capital goods.

For exporters, it recommended targeted support for tariff-sensitive sectors and the creation of a Trade Resilience Fund to help firms manage disruptions and diversify supply chains. 

Expanding digital public infrastructure, such as AI-enabled customs and real-time logistics systems, would further reduce compliance costs, it said.

With MSMEs contributing nearly 30 percent to GDP and employing 290 million people, Deloitte said strengthened credit flows, digital readiness and competitiveness are essential for inclusive growth.

(KNN Bureau)