Lok Sabha Question No. 3000 (UNSTARRED), answered on 2025-08-07
Subject: Credit deficit in the MSME sector
Ministry: MICRO, SMALL AND MEDIUM ENTERPRISES
Asked by: Shri Balwant Baswant Wankhade, Adv Dean Kuriakose, Shri Charanjit Singh Channi

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

## LOK SABHA UNSTARRED QUESTION NO. 3000 TO BE ANSWERED ON: 07.08.2025

## CREDIT DEFICIT IN THE MSME SECTOR

3000.   SHRI CHARANJIT SINGH CHANNI: SHRI BALWANT BASWANT WANKHADE: ADV DEAN KURIAKOSE:

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

- (a) the  estimate  of  credit  deficit  in  the  MSME  sector  by  June  2025  and  the  proportion  of MSMEs using formal credit channels;
- (b) the average payment period for large customers classified by industry; and
- (c) the  reforms  implemented in recent  years  to  improve  credit  flow  and  liquidity  of  MSMEs, particularly addressing issues of delayed receivables?

## ANSWER

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

- (a): The Expert  Committee  on  Micro,  Small  and  Medium  Enterprises,  constituted  by  Reserve Bank of India (RBI) in 2019 estimated the credit gap in MSME sector to be in the range of Rs. 20 to Rs. 25 lakh crore.

As  informed  by  RBI,  the  number  of    MSME  Accounts  with  the  Scheduled  Commercial Banks is given below:

| Number of MSMEAccounts with the Scheduled Commercial Banks (SCBs)   | Number of MSMEAccounts with the Scheduled Commercial Banks (SCBs)   | Number of MSMEAccounts with the Scheduled Commercial Banks (SCBs)   |
|---------------------------------------------------------------------|---------------------------------------------------------------------|---------------------------------------------------------------------|
| Sl. No.                                                             | Financial Year                                                      | No. of A/cs (in lakh)                                               |
| 1                                                                   | As on March 31, 2023                                                | 213.32                                                              |
| 2                                                                   | As on March 31, 2024                                                | 256.97                                                              |
| 3                                                                   | As on March 31, 2025                                                | 243.15                                                              |

Source: RBI

- (b): RBI has developed Unified Lending Interface (ULI) for frictionless credit to transform the lending landscape in India by making  credit more  accessible by reducing documentation requirements  and simplifying the loan application process. ULI  eliminates the need  for  complex, costly  integrations  with  individual  data  providers  enabling  lenders  to  make  quicker  and  betterinformed loan decisions, cutting approval times and reducing operational costs.
- (c): To improve credit flow and liquidity of MSMEs, a number of measures have been taken by Government of India. Some of them are:

- i. Under  the  Credit  Guarantee  Scheme  (CGS)  for  Micro  and  Small  Enterprises  (MSEs)  of Ministry of MSME, additional corpus fund of Rs. 9,000 crore was infused into the corpus of Credit Guarantee Fund Trust for MSEs, to enable an additional credit of Rs. 2.00 lakh crore, at a reduced cost of credit. Further, the guarantee ceiling has been increased from Rs. 5 crore to Rs. 10 crore (w.e.f. 01.04.2025) to MSEs, with guarantee coverage up to 90%, for various category of loan under CGS.
- ii. Prime Minister's Employment Generation Programme provides Margin Money subsidy upto 35%, for setting up of new micro enterprises, in the non-farm sector with project cost of Rs. 50 lakh and Rs. 20 lakh, for Manufacturing and Services enterprises, respectively.
- iii.  PM  Vishwakarma,  launched  on  17.09.2023  to  provide  end-to-end  support  to  artisans  and craftspeople  of  18  traditional  trades  who  work  with  their  hands  and  tools.  The  Scheme includes provision of loans upto Rs. 3 lakh with interest subvention of 8%.
- iv.   Self Reliant India (SRI) Fund has been set up to infuse Rs. 50,000 crore as equity funding in those MSMEs, which have the potential and viability to grow and become large units. Under this  Fund, there is  a provision of Rs. 10,000 crore from the Government of India and Rs. 40,000 crore through Private Equity/Venture Capital Funds.
- v. To ensure timely payment settlements for Micro and Small Enterprises (MSEs) across the country, Ministry of MSME launched SAMADHAAN Portal on 30.10.2017 for monitoring of the outstanding dues to the MSEs. 161 Micro & Small Enterprises Facilitation Councils (MSEFCs) have so far been set-up in States/UTs. Ministry of MSME has launched Online Dispute Resolution (ODR) Portal on 27.06.2025 to provide end-to-end digitized resolution of the delayed payment cases.
- vi.   RBI  issued  guidelines  for  setting  up  and  operating  the  Trade  Receivables  Discounting System (TReDS) to facilitates the financing of trade receivables of MSMEs from corporate and  other  buyers,  including  Government  Departments  and  Public  Sector  Undertakings (PSUs)  through  multiple  financiers  electronically.  Five  entities  are  presently  operating TReDS. The monetary limit for onboarding on TReDS for Corporates and CPSEs has been reduced to a turnover of Rs. 250 Crore vide Notification dated 07.11.2024.

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