In July, MSME credit by scheduled commercial banks under priority sector lending reached Rs 25.10 lakh crore, marking a 15% increase from Rs 21.82 lakh crore in the same period last year, according to the latest sectoral credit deployment data from the Reserve Bank of India (RBI) released on Friday.
Priority credit to MSMEs in July accounted for 14.9% of India’s non-food credit, which totaled Rs 167 lakh crore for the month. This is a slight decrease from the 15.9% share recorded in July of the previous year.
In July, credit to micro and small enterprises (MSEs) within the MSME sector increased by 14.3%, reaching Rs 19.9 lakh crore, up from Rs 17.4 lakh crore in the same month last year. Likewise, credit to medium-sized units surged by 17.9%, amounting to Rs 5.11 lakh crore last month, compared to Rs 4.34 lakh crore in July of the previous year.
The RBI’s upcoming digital platform aims to enhance MSME lending. On August 26, the central bank’s Governor announced at an event that the new Unified Lending Interface (ULI) platform, designed to enable frictionless credit, will be launched soon. This platform will address the significant unmet demand for credit across various sectors, particularly for agricultural and MSME borrowers.
The new platform will “facilitate the seamless and consent-based flow of digital information, including land records from various states, from multiple data service providers to lenders. This will reduce the time taken for credit appraisal, especially for smaller and rural borrowers,” the Governor stated.