The Micro, Small and Medium Enterprises Development Act, 2006 (‘MSMED Act’) aims to protect and promote interests of micro, small and medium enterprises (‘MSMEs’) by shortening their working capital cycle. The MSMED Act, inter alia, seeks to incentivise timely payments to MSMEs by mandating a relatively high interest, at three times the bank rate notified by the Reserve Bank of India (‘RBI’), to be paid by a buyer for the period of delay, over the maximum prescribed time period for the payment. The interest mandated by the MSMED Act is compounded until the date of actual payment. The framework around this single provision of the MSMED Act creates a moral hazard of unduly delayed claims by the vendors, immense financial hardship for buyers due to mounting interest and an entirely unintended consequence of disincentivising buyers from dealing with MSMEs. In order to remedy this, the note examines whether, like all commercial claims, a claim under the MSMED Act must also, by passage of time, be barred by limitation.