In a historic move to empower the small business ecosystem, the Uttar Pradesh government has announced a transformative initiative to help Micro, Small, and Medium Enterprises (MSMEs) tap into the capital market. Under the leadership of Chief Minister Yogi Adityanath, the state has signed a Memorandum of Understanding (MoU) with the National Stock Exchange (NSE), opening the gateway for small enterprises to list on the stock exchange.
500 MSMEs Set to Step into Equity Markets
As per the newly signed agreement, 500 MSMEs from Uttar Pradesh are expected to enter the capital market in the near future. This initiative is part of the state’s broader MSME policy, aimed at enhancing financial access and supporting the growth trajectory of small businesses.
With over 96 lakh MSME entrepreneurs operating in the state, this development is seen as a significant milestone that will redefine entrepreneurial financing in India’s most populous state.
₹5 Lakh Financial Assistance to Each Company for Listing
In a first-of-its-kind step, the Yogi government will offer ₹5 lakh financial assistance to every eligible MSME looking to get listed on the stock exchange. The state’s MSME Department has confirmed that this support will be extended under the MSME Promotion Policy, allowing businesses to meet compliance and listing costs associated with the Initial Public Offering (IPO) process.
NSE EMERGE Platform to Lead the Transition
The NSE EMERGE platform, specifically designed for emerging businesses, will serve as the entry point for these MSMEs into the equity markets. The platform will not only facilitate listing but also offer advisory support and capacity-building programs for MSME owners.
In collaboration with the Uttar Pradesh Small Industries Corporation (UPSIC), the NSE will organize roadshows, awareness camps, seminars, and IPO training sessions across the state. The goal is to ensure that small enterprises are well-equipped to navigate capital markets confidently.
NSE officials confirmed that 612 MSMEs across India have already been listed on the NSE EMERGE platform, indicating a strong national precedent.
500 MSME Champions Being Groomed Under World Bank-Backed Program
The Uttar Pradesh MSME Department, with backing from the World Bank’s RAMP (Raising and Accelerating MSME Performance) program, is currently developing a batch of 500 MSME champions. These companies are being mentored intensively to reach a level where they can raise funds through equity financing.
Following the MoU, these selected MSMEs will be prioritized for early entry into the capital markets, setting a benchmark for other states to emulate.
Boost to Municipal Bonds Alongside MSME Push
In parallel to the MSME reforms, various municipal corporations in Uttar Pradesh are also preparing to raise funds through municipal bonds. Notably, Lucknow and Ghaziabad municipal corporations have already issued bonds, and soon, Prayagraj and Varanasi will follow suit.
This dual strategy reflects the state’s commitment to unlocking alternate financing avenues for both public and private sector development.
Strategic Benefits of the Move
Enhanced Capital Access: Small enterprises will now have a structured channel to raise equity capital without over-reliance on debt.
Job Creation: Infusion of funds will allow MSMEs to expand operations, leading to employment opportunities.
Increased Investor Confidence: Government-backed listings ensure transparency and boost investor trust in small-cap ventures.
Improved Financial Literacy: Awareness initiatives will empower entrepreneurs to make informed financial decisions.
A Bold Vision for India’s MSME Growth Engine
The government’s collaboration with NSE is a game-changer for Indian MSMEs, especially in an economy where small enterprises are often undercapitalized and undervalued. By providing both financial incentives and institutional support, Uttar Pradesh is taking the lead in creating a self-reliant, investment-ready MSME ecosystem.
As this initiative gains momentum, Uttar Pradesh is expected to become a model state for MSME-led industrial growth and capital market penetration.
