Expert-led Online Courses: Elevate Your Skills, Get ready for Future - Enroll Now!
What is the full form of SME?
SME stands for Small and Medium Enterprises also known as Small and Medium-sized Enterprises (SMBs). They have a limited number of workers and their investments in assets fall below a certain amount. They are important in the development and growth of the industrial economy of a country and motivate citizens to boost competitiveness and innovation.
Types of SMEs
Under section 7 of the 2006 Micro, Small & Medium Enterprises Creation Act, we define SME in India by the amount of investment in each sector.
In Case of Industrial Enterprises
1. Micro Enterprises – up to 25 lakh Rs of expenditure on the plant and equipment.
2. Small Enterprises – Expenditure on plant and equipment is between 25 lakh Rs and 5 crore Rs.
3. Medium Enterprises – Revenue in the plant and equipment is between 5 crore Rs and 10 crore Rs.
In the case of Service Companies
1. Micro Enterprises – Spend up to 10 lakh Rs on tools and equipment.
2. Small Enterprises – Spending on tools and equipment is between 10 Lakh Rs and 2 crore Rs.
3. Medium Enterprises – Spending on tools and equipment is between two crore Rs and 5 crore Rs.