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Bank credit to MSMEs in December 2023 grows 19% from year-ago period: RBI data

The priority lending as of December 2023 in MSMEs was 14.9 per cent of Rs 159.18 lakh crore in India’s total non-food credit during the month in comparison to 15.1 per cent during December 2022. 

The deployment of gross bank credit to MSMEs under the priority sector lending as of December 2023 stood at Rs 23.87 lakh crore, growing by 19.1 per cent from Rs 20.03 lakh crore as of December 2022, showed the latest monthly data by the Reserve Bank of India (RBI) on deployment of bank credit. As of March 2023, the deployment was at Rs 20.69 lakh crore. 

Priority sector lending refers to enabling credit to sectors that impact large sections of the population, the weaker sections and the sectors which are employment-intensive such as agriculture, and MSME. 

As per RBI, a sub-target of 7.5 per cent of Adjusted Net Bank Credit (ANBC) or Credit Equivalent of Off-Balance Sheet Exposure (CEOBE), whichever is higher, towards lending to the micro enterprises under overall priority sector lending has been prescribed for domestic commercial banks, foreign banks with 20 branches and above, regional rural banks and small finance banks. 

The priority lending as of December 2023 in MSMEs was 14.9 per cent of Rs 159.18 lakh crore in India’s total non-food credit during the month in comparison to 15.1 per cent during December 2022. 

The deployment as of December 2023 for micro and small enterprises in the MSME sector stood at Rs 19.18 lakh crore, up by 20.4 per cent from Rs 15.93 lakh crore during the year-ago period. Likewise, for medium enterprises, credit deployment was Rs 4.68 lakh crore during December 2023, showing growth of 14.4 per cent from Rs 4.10 lakh crore as of December 2022.