What changed
The Government of India amended its June 26, 2020 notification via Gazette S.O. 2347(E) dated June 16, 2021. Consequently, RBI modified its August 21, 2020 circular: existing EM Part II and UAMs obtained till June 30, 2020 are now valid until December 31, 2021, instead of the earlier deadline.
What it means for you
Banks and lenders can continue to rely on existing MSME registrations for classification and lending without requiring immediate re-registration. This extension reduces compliance burden for both MSMEs and financial institutions during the transition to the new definition.
What you must do
- Update internal systems to reflect the extended validity of EM Part II and UAMs till December 31, 2021.
- Communicate the extension to branches and credit teams to avoid rejecting valid registrations.
- Monitor for any further amendments to the MSME definition or registration process.
Who it affects
All commercial banks including SFBs, LABs, and RRBs, Primary Urban Co-operative Banks, State Co-operative Banks, DCCBs, All-India Financial Institutions, All Non-Banking Financial Companies, MSME borrowers with EM Part II or UAM obtained before July 1, 2020
Does this circular change the MSME definition itself?
No. Only the validity period of old registrations (EM Part II and UAMs) is extended to December 31, 2021. All other provisions of the August 21, 2020 circular remain unchanged.
What if an MSME has a registration obtained after June 30, 2020?
This extension applies only to registrations obtained till June 30, 2020. Registrations obtained after that date are governed by the new definition and are not affected by this circular.