The small-scale sector has been an effective tool for the social change and economic growth of a number of countries. The small and medium scale industries represent 80 per cent of industrial base of the most developed countries. In Japan about 99 per cent of the units are SMEs contributing 52 per cent of the total exports revenue. In Italy approximately 94 per cent of the Italian firms are SMEs contributing about 43 per cent of the total GDP. In the USA, SMEs play a dominant role. They generate about 54 per cent of the sales revenue. The Congress of the United States passed the Small Business Investment Act in 1958. The purpose of the Act is to improve and stimulate the national economy in general and the small business segment thereof in particular. The policy ensures maximum participation of the private financing sources to provide funds, which the small scale business would need for growth, expansion and modernization.