Lok Sabha passes MSME payment delay bill amid opposition protests

The Lok Sabha on Friday passed the Micro, Small and Medium Enterprises Development (Amendment) Bill, 2026, without a debate, amid protests by opposition members. The bill has now been cleared by Parliament, having been passed in the Rajya Sabha on August 3.

The legislation seeks to address delayed payments faced by micro, small and medium enterprises (MSMEs) by improving the administrative structure and strengthening payment mechanisms.

What does the bill propose?


The bill prescribes timelines for faster adjudication of payment disputes, provides for recovery of settlement agreements, and includes measures to address MSMEs' liquidity issues. It also 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.

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MSMEs contribute 31 per cent to India's GDP, 36 per cent to the country's manufacturing output and 41 per cent to its exports.

Ahead of the bill's passage in the Rajya Sabha on August 3, MSME Minister Jitan Ram Manjhi told the Upper House that outstanding credit disbursed to MSMEs had risen from Rs 10 lakh crore in 2014-15 to over Rs 38.35 lakh crore currently, indicating steady growth in credit flow to the sector.

On Friday, opposition members continued protests in the Lok Sabha over various issues, disrupting Zero Hour. The bill was cleared in nearly 16 minutes of proceedings after the House met at 12 noon, following the day's first adjournment. The Lok Sabha was later adjourned till Monday.

(With inputs from PTI)