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Abstract
The growth of MSME sector has been quite impressive after 1991, with many new ventures coming up and providing job opportunities to millions of people. This was considered to be the emerging area of the economy as it was leading the change with innovation and support to the major industries. The ability to promote exports and drive revenue to higher levels expanded with government coming up with schemes that were business friendly in nature. Over the last five years the growth around this sector has got stagnated and there has been a severe challenge in terms of reviving the growth. The entrepreneurs have started facing problems in trade regarding the resource utilization and credit since both of them are on the sinking ground. The thirst for growth started subduing because the financial institutions are refusing to go with cheaper loans and they don’t want to take on the risk of getting into bad debts. Many entrepreneurs have not made themselves aware of the various schemes that are available and have always relied on the fact that banks would rescue them in case of any capital needs . RBI’s new policy emphasizes on the fact that the MSME should be given priority of 20% growth year on year which can promote the economy to greater heights. The banks have been instructed under various schemes laid down by the central bank in terms of governance and credit issues toward financing this sector.