Lok Sabha Question No. 3060 (UNSTARRED), answered on 2025-12-18
Subject: Loan Disbursal to MSMEs
Ministry: MICRO, SMALL AND MEDIUM ENTERPRISES
Asked by: Shri Raja Ram Singh

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION NO. 3060 TO BE ANSWERED ON: 18.12.2025

## LOAN DISBURSAL TO MSMEs

3060. SHRI RAJA RAM SINGH:

Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:

- (a) whether it is true that loan disbursal to Micro, Small and Medium Enterprises (MSMEs) continues  to  fall  by  11%  and  credit  demand  remains  unmet  despite  major  announcements  in Budget 2025, such as enhanced credit guarantees, the ME-Card initiative and the proposed Fund of Funds;
- (b) the reasons for  abruptly  halting  schemes  critical  to  small  enterprises,  such  as  the  Credit Linked Capital Subsidy Scheme;
- (c) whether the Government acknowledges that MSMEs still face difficulties like, inaccessible credit,  bureaucratic  delays  and  lack  of  collateral-free  loans,  especially  for  micro-enterprises  in informal clusters, if so, the remedial action taken thereof; and
- (d) whether  the  mechanisms  are  in  place  to  monitor  whether  Budget  schemes  are  actually reaching MSMEs, particularly in Tier-II/III cities and rural belts and if so, the details thereof and if not, the reasons therefor?

## ANSWER

## MINISTER OF STATE FOR MICRO, SMALL AND MEDIUM ENTERPRISES (SUSHRI SHOBHA KARANDLAJE)

(a) to (c): No. As per Reserve Bank of India (RBI), the credit disbursed to the MSME sector by  Scheduled  Commercial  Banks  (excluding  RRBs)  for  the  past  three  financial  years  has registered  a  substantive  growth,  growing  at  a  CAGR  of  15.93  %  in  the  past  three  years,  as indicated below:

| Financial Years   |   Amount disbursed (in Rs. crore) |
|-------------------|-----------------------------------|
| 2022-23           |                       1.69674e+06 |
| 2023-24           |                       2.20445e+06 |
| 2024-25           |                       2.64345e+06 |

Credit  Linked  Capital  Subsidy  (CLCS)  Scheme  launched  on  1  October  2000  aimed  at facilitating  technology  up-gradation  in  Micro  and  Small  Enterprises  (MSEs)  by  providing  an upfront capital subsidy of 15 percent to the MSEs on institutional finance availed by them. It was in operation till 31.03.2020 only. Since inception, the scheme benefitted around 87,989 units by providing them with total capital subsidy of Rs 5685.87 crore since its inception. Government is providing  financial  support  for  procurement  of  equipment/machinery  through  schemes  such  as Mutual Credit Guarantee Scheme (MCGS-MSME) for credit facility upto Rs. 100 crore, Special Credit Linked Capital Subsidy (SCLCSS) under National Schedule Caste and Schedule Tribe Hub (NSSH) etc.

The Union Budget 2025-26 outlines a strategic approach to bolster the MSME sector in India, emphasizing increased credit access, entrepreneurial support, and sector-specific initiatives. Government of India has enhanced investment and turnover limits for classification of all MSMEs by 2.5 and 2 times respectively, coupled with enhanced credit guarantee limits from Rs. 5 crore to Rs. 10 crore.

Government  of  India  has  taken  a  number  of  initiatives  to  provide  financial  assistance  to Micro, Small and Medium Enterprises (MSMEs) in the Country. Some of them are:

- (i) Credit Guarantee Scheme (CGS) for Micro and Small Enterprises (MSEs) through Credit Guarantee  Fund  Trust  for  Micro  and  Small  Enterprises  (CGTMSE)  to  provide  credit guarantee for loans upto Rs 10 crore extended to MSEs without collateral security or thirdparty guarantees.
- (ii) Self-Reliant India (SRI) Fund has been set up to infuse Rs. 50,000 crore as equity funding in  MSMEs with a provision of Rs. 10,000 crore from the Government of India and Rs. 40,000 crore through Private Equity/Venture Capital Funds.
- (iii) Prime Minister's Employment Generation Programme (PMEGP) provides Margin Money subsidy up to 35%, for setting up of new micro enterprises, in the non-farm sector with project cost of Rs. 50 lakh for Manufacturing and Rs. 20 lakh for Services enterprises.
- (iv) PM  Vishwakarma  Scheme  was  launched  on  17.09.2023  to  provide  end-to-end  holistic support to artisans and craftspeople of 18 traditional trades who work with their hands and tools. The Scheme includes provision of loans up to Rs. 3 lakh with interest subvention of max up to 8%.
- (v) Emergency Credit Line  Guarantee  Scheme (ECLGS) launched for businesses, including MSMEs with a provision to provide a cover for Credit Guarantee to the tune of Rs 5 lakh crore. The scheme was operational till 31.03.2023.

(d): Ministry of MSME monitors performance of its schemes in the Country, including TierII/III cities and rural belts. Some of these mechanisms include, Udyam Registration Portal, MSME Samadhan  Portal,  Sambandh  Portal,  CHAMPIONS  Portal,  Geo-tagging  of  PMEGP.  Recently, MSME Dashboard integrated through API with all the major Schemes of the Ministry has been launched in this direction.

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