Huge gap in demand for credit by MSMEs & loans given by banks: Expert

The micro, small and medium enterprises (MSME) sector provides the banks with a lending opportunity of USD 70 billion, says a report.

The MSME sector has been down in the dumps since the note-ban and the soon-to-be-followed implementation of the uniform tax regime GST, forcing millions of units to down shutters causing huge job losses.

This has made the government force the Reserve Bank to offer a special dispensation last month under which the banks were allowed to recast stressed MSME loans under Rs 25 crore outside the NCLT route.

"Small and medium units together have a potential of taking USD 70 billion in formal credit from banks," industry lobby Assocham and Ashvin Parekh Advisory Services said in a joint report Tuesday.