Dear @nithin @Quicko
As per new definition of MSME, trading is also included (till recently only manufacturing and servicing sector are included). And trading in f&o is treated as normal business activities (not speculative business activities) as per CBDT.
It’s means trading in f&o are also included in MSME definition, Isn’t it ?
You may think why I am asking this, actually MSME eligible for priority sector lending, due to which one may get loan easier with low rate of interest.
Thanks
Could you please let me know from where you got the new definition of MSME? I tried to search the net but failed. Appreciate if you could let me know the link.
@neha1101
Please find link below
https://m.rbi.org.in//Scripts/NotificationUser.aspx?Id=12126&Mode=0
Can you share the circular? Btw, I don’t think there is anything from RBI on this.
The link leads me to RBI website, did a search but could not find one on the new definition of MSME.
Dear @nithin
Please find circular link in pdf format below
https://rbidocs.rbi.org.in/rdocs/notification/PDFs/MSME25199EAA23EF4A409B11F776148EB0E4.PDF
Also screenshot of that document below
Also find below news from
Sir
Sorry to keep pursuing you on this, but I do not find any corelation between “stock market trading” getting included as part of MSME. “Retail and Wholesale Trade” as defined in MSME definition refer to to Micro, Small and Medium Enterprises and not “traders” in stock market.
Absolutely confused, maybe I am missing a point.
+1
Being an MSME helps a business raise funds as they then come under priority sector. The word trade & trading here isn’t referring to customer trading stocks on the exchanges.
This also doesn’t mean that anything changes with the way you file your income tax returns. If there is any change around that, it has to come from the IT department and not from RBI.
Yes, you are correct. As per the new MSME definition introduced in 2020 and effective from July 1, 2020, trading activities are now included alongside manufacturing and service sectors. This is a significant change from the earlier definition where only manufacturing and services were covered.
Regarding trading in Futures & Options (F&O), the CBDT has clarified that such trading is considered a normal business activity, not speculative. Therefore, trading in F&O also falls within the scope of MSME, provided the enterprise meets the prescribed investment and turnover limits.
This inclusion means that enterprises engaged in trading, including F&O trading, can now avail benefits under MSME schemes such as priority sector lending, which often comes with easier access to loans at lower interest rates.
Summary
The new MSME definition expands eligibility to traders, including those involved in F&O, helping them access various MSME benefits like priority sector lending. Get assistance in seeking MSME certificate from experts at Setindiabiz.
If it is , its a great thing for the Retail traders , Not only gives them a respective platform to address their issues with Government and also Retail traders will be respected by the stock market Regulators , These regulators are saying Trading activity is not a Productive work and Retail traders are gamblers
