Union Cabinet approves Rs 10,000 crore SME Growth Fund

Key facts

• The Union Cabinet on Tuesday (October 6, 2026) approved the Small and Medium Enterprise (SME) Growth Fund (SGF) with an outlay of Rs 10,000 crore to provide equity support to small and medium enterprises.
• The fund, first announced in the Union Budget 2026-27, aims to address the gap in long-term growth-stage equity capital available to SMEs, as existing funds largely focus on early-stage and micro enterprises.
• Under the scheme, the government will provide an aggregate commitment of Rs 10,000 crore to an Alternative Investment Fund (AIF) established under the SGF framework, offering patient growth equity capital to high-potential SMEs with demonstrated business viability and scalability.
• A majority of the fund's allocation will be directed towards small and medium manufacturing enterprises, with a focus on SMEs in industrial clusters in Tier-II and Tier-III cities.
• Finance Minister Nirmala Sitharaman had announced the Rs 10,000 crore SME Growth Fund in the Budget to create future champions, along with a Rs 2,000 crore top-up to the Self-Reliant India Fund set up in 2021 to support micro enterprises.