Lok Sabha Question No. 4662 (UNSTARRED), answered on 2025-08-21
Subject: Credit Gap faced by Micro Enterprises
Ministry: MICRO, SMALL AND MEDIUM ENTERPRISES
Asked by: Shri Sribharat Mathukumilli

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

## LOK SABHA UNSTARRED QUESTION NO. 4662 TO BE ANSWERED ON: 21.08.2025

## CREDIT GAP FACED BY MICRO ENTERPRISES

## 4662.        SHRI SRIBHARAT MATHUKUMILLI:

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

- (a) whether  the  Government  has  taken  note  of  the  SIDBI  report  indicating  that,  despite significant formalization, around 35% of micro enterprises remain informal and face a credit gap of approximately Rupees 30 lakh crore, with women-led MSMEs experiencing an even higher gap of 35%;
- (b) whether  the  Ministry  has  analyzed  specific  regional  or  sectoral  patterns  of  this  formalinformal  divide  and  the  persistent  shortfall  in  credit  access,  especially  for  micro-enterprises  and women entrepreneurs;
- (c) the  targeted  measures  being  taken  such  as  collateral-free  lending,  fintech  interventions,  or credit guarantee enhancements to close these gaps and bring more micro and women-led units into the formal, credit-accessible economy; and
- (d) whether the Ministry plans to monitor progress through periodic data collection and linkage with schemes like Udyam registration, CGTMSE and digital lending platforms?

## ANSWER

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

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

-  Government launched Udyam Assist Platform (UAP) on 11.01.2023 to bring Informal Micro Enterprises (IMEs) into the formal ambit. As of August 12, 2025, 2.75 Crore IMEs have been formalised.  These  enterprises  are  eligible  for  availing  the  benefit  under  Priority  Sector Lending and marketing assistance. More than 62% of the enterprises registered on UAP are owned by women.
-  Most  of  the  Schemes  of  the  Government  of  India  like  Prime  Minister's  Employment Generation  Programme  (PMEGP),  Credit  Guarantee  Scheme  (CGS)  for  Micro  and  Small Enterprises (MSEs), Procurement and Marketing Support Scheme (PMSS), PM Vishwakarma Yojana, Pradhan Mantri Mudra Yojana provide support to Micro Enterprises, including those owned by women. Under CGS, 84.94 lakh guarantees worth Rs.5,43,716 crore were issued to Micro Enterprises as on 31.07.2025, which accounts for 70% of number of guarantees issued and 52% of the guarantee amount.

- i. Under CGS, following two provisions have been introduced for women entrepreneurs:
2.  Guarantee coverage of up to 90%, as against the 75% for others; and
3.  10% concession in Annual Guarantee Fees.
- ii. Further,  in  order  to  facilitate  unsecured  affordable  credit  flow  to  IMEs  for  their  composite requirement, special provision under CGS has been launched. Credit facility up to Rs 20 lakh is guaranteed with extent of coverage of 85%.
- iii. Under  PMEGP  women  are  provided  higher  subsidy  (35%)  vis-a-vis  non-special  category (upto 25%).
- iv. Participation  of  women  entrepreneurs  in  trade  fairs  under  Procurement  and  Marketing Support Scheme is subsidized 100% vis-a-vis 80% for other entrepreneurs.
- v. To  encourage  entrepreneurship  among  women,  Ministry  of  MSME  implements  'Skill Upgradation  and  Mahila  Coir  Yojana'  under  Coir  Vikas  Yojana,  which  is  an  exclusive training programme aimed at skill development of women artisans engaged in the Coir sector.
- vi. The  Ministry  of  MSME  launched  'PM  Vishwakarma' Scheme on 17.09.2023, to  provide a number of benefits to the traditional artisans and craftspeople including women, engaged in 18  trades.  Up  to  30.07.2025,  a  total  of  29.98  lakh  artisans  and  craftspeople  have  been successfully registered across the country, including 10.8 lakh successfully registered women beneficiaries.
- vii. The Ministry of MSME launched an initiative namely 'Yashasvini', on 27.06.2024, which aims to campaign, with a focus in Tier-II/III towns, for women entrepreneurs and empower women by building their capacity.

In  Budget 2025, a new scheme for 5 lakh women, Scheduled Castes and Scheduled Tribes first-time entrepreneurs for term loans up to Rs.2 crore during the next 5 years, has been announced.

- (d): The  Udyam  Registration  Portal  has  API  integration  with  a  number  of  Portals  which  also include linkage with CGTMSE and TReDS Platforms. Further, Udyam Registration Portal has been integrated with portals of National Career Services, e-Shram of Ministry of Labour & Employment and Skill India Digital Portal.

PM  Vishwakarma  Scheme  components  include  Credit  Support  and  Incentive  for  Digital Transactions. All services, including lending support are delivered through a single integrated Portal.

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