Lok Sabha Passes MSME Development (Amendment) Bill 2026 to Tackle Delayed Payments

Key facts

• The Lok Sabha passed the Micro, Small and Medium Enterprises Development (Amendment) Bill, 2026, without a debate amid opposition protests.
• The Bill was earlier passed by the Rajya Sabha on August 3, 2026, and has now been cleared by Parliament.
• The legislation seeks to address delayed payments faced by MSMEs by improving the administrative structure and strengthening payment mechanisms.
• The Bill prescribes timelines for faster adjudication of payment disputes and provides for recovery of settlement agreements.
• It includes measures to address liquidity issues of MSMEs.
• It empowers courts to order payment of at least 50 per cent of the awarded amount to MSME suppliers if an application to set aside an order remains pending for more than six months.
• MSMEs contribute 31 per cent to India's GDP, 36 per cent to manufacturing output, and 41 per cent to exports.
• Outstanding credit disbursed to MSMEs rose from Rs 10 lakh crore in 2014-15 to over Rs 38.35 lakh crore currently.