Micro, Small, and Medium Enterprises (MSMEs) play a vital role in the economy. They create jobs, drive innovation, and contribute significantly to GDP. However, one of the biggest challenges for these businesses is accessing finance. MSME business loans are designed to help these enterprises grow and thrive. Let's break down the eligibility criteria for obtaining an MSME loan for a new business in simple terms.

1. Understanding MSME Classification: Before diving into the eligibility criteria, it's crucial to understand what qualifies as an MSME. The classification is based on the investment in plant and machinery or equipment and the annual turnover of the enterprise. Micro enterprises have an investment of up to INR 1 crore and turnover up to INR 5 crores. Small enterprises have an investment of up to INR 10 crores and turnover of up to INR 50 crores. Medium enterprises have an investment of up to INR 50 crores and a turnover of up to INR 250 crores. Knowing where your business stands is the first step toward understanding eligibility.