Lok Sabha Question No. 1720 (UNSTARRED), answered on 2024-12-05
Subject: NPAs in MSME Sector
Ministry: MICRO, SMALL AND MEDIUM ENTERPRISES
Asked by: Shri Anil Yeshwant Desai

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

## LOK  SABHA UNSTARRED QUESTION NO. 1720 TO BE ANSWERED ON 05.12.2024

## NPAs IN MSME SECTOR

1720.

SHRI ANIL YESHWANT DESAI:

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

- (a) whether it is a fact that there are increasing number of cases of non re-payment of the loan taken by entrepreneur in MSME sector;
- (b) if so, the size of Non-Performing Assets (NPAs) amount in MSME Sector vis-à-vis NPAs of other sectors during the last five years;
- (c) the percentage of NPAs of  MSMEs to the total NPAs during the last five years; and
- (d) the details of the securities that bank must ensure before granting loan to such MSME units?

## ANSWER

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

(a) to (c): The Gross Non-Performing Assets (GNPA) with respect to outstanding to MSME and the percentage thereon show a declining trend as per Table below:

(Amount in Rs. Crore)

|                | Scheduled Commercial Banks                | Scheduled Commercial Banks   | Scheduled Commercial Banks                                                |
|----------------|-------------------------------------------|------------------------------|---------------------------------------------------------------------------|
| Period (As on) | MSME-Total Advances (Outstanding)- Funded | MSME-Gross NPAs (Domestic)   | MSME-Gross NPAs(Domestic) as %of MSME-Total Advances (Outstanding)-Funded |
| 31-Mar-20      | 16,97,836                                 | 1,87,255                     | 11.03%                                                                    |
| 31-Mar-21      | 18,45,188                                 | 1,60,464                     | 8.70%                                                                     |
| 31-Mar-22      | 20,44,788                                 | 1,54,991                     | 7.58%                                                                     |
| 31-Mar-23      | 23,92,319                                 | 1,30,869                     | 5.47%                                                                     |
| 31-Mar-24      | 28,04,511                                 | 1,25,217                     | 4.46%                                                                     |

Source: RBI

As per the information given by Reserve Bank of India (RBI), the number of cases classified as NPA for Scheduled Commercial Banks for period ending March 31, 2023 and March 31, 2024 is 41,06,379 and 44,62,386, respectively.

- (d): As  informed  by  RBI,  on  lending  to  MSME  Sector,  banks  are  mandated  not  to  accept collateral  security  in  case  of  loans  up  to  Rs.  10  lakh  extended  to  units  in  the  Micro  and  Small Enterprises  sector.  As  per  Department  of  Financial  Service,  banks  are  free  to  take  credit  related decision in terms of their Board approved policies and RBI's broad regulatory guidelines.

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