Cabinet commits ₹10,000 crore to an SME Growth Fund for equity in small and medium firms
Key facts
- On 6 October 2026, the Union Cabinet approved a ₹10,000 crore commitment to the SME Growth Fund (SGF).
- The money goes to an Alternative Investment Fund that makes direct equity investments in SMEs.
- Most of the fund will go to small and medium manufacturing firms.
- It will also back SMEs in industrial clusters in Tier-II and Tier-III cities.
Why it matters
[Policy] Most existing equity funds back early-stage and micro firms. Small and medium firms that want to scale find little long-term risk capital. The SGF fills this gap with patient growth equity, as promised in Para 28 of Union Budget 2026-27. Since April 2025, a small enterprise means investment up to ₹25 crore and turnover up to ₹100 crore. This links to GS-3 MSMEs and industrial policy.
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