Credit and finance for MSMEs: Overall, the aggregate credit to the MSME sector, including MSEs and medium enterprises, in October was Rs 17.99 lakh crore, 20.3 per cent up from Rs 14.95 lakh crore in October 2021.
Credit and finance for MSMEs: Gross bank credit deployed by scheduled commercial banks to micro and small enterprises in the country under the priority sector lending (PSL) norms jumped 15.9 per cent year-on-year in October in comparison to a paltry 0.6 per cent growth in October last year, showed latest monthly data on sectoral deployment of bank credit by the Reserve Bank of India (RBI). The credit to MSEs increased from Rs 12.34 lakh crore in October 2021 to Rs 14.30 lakh crore in October 2022. The credit deployed in September and August was marginally higher at Rs 14.83 lakh crore and Rs 14.49 lakh crore respectively.
Credit to medium enterprises also maintained a strong growth of 41.1 per cent to Rs 3.69 lakh crore in October this year from Rs 2.61 lakh crore in October 2022. The October 2021 credit growth to medium units was 27.3 per cent. Meanwhile, September credit to medium enterprises stood at Rs 3.71 lakh crore and Rs 3.65 lakh crore in August.
Overall, the aggregate credit to the MSME sector, including MSEs and medium enterprises, in October was Rs 17.99 lakh crore, 20.3 per cent up from Rs 14.95 lakh crore in October 2021 while in September 2022, the total MSME credit deployed was Rs 18.55 lakh crore. Importantly, among sectors eligible for PSL, credit to MSMEs was highest followed by Rs 16.23 lakh crore to agriculture and allied activities, Rs 13.37 lakh crore to weaker sections, Rs 6.31 lakh crore to housing, etc.
The credit appetite of MSMEs is likely to be robust ahead with the extension of the government’s post-Covid credit scheme for MSMEs Emergency Credit Line Guarantee Scheme (ECLGS) till March 31 2023, Finance Ministry had said in its Monthly Economic Review for September 2022. The finance minister Nirmala Sitharaman in this year’s budget had extended ECLGS till the end of the current fiscal from March 2022 and also increased the guarantee cover by Rs 50,000 crore to take the total limit of the scheme to Rs 5 lakh crore from Rs 4.5 lakh earlier. As of August 5, 2022, loans of about Rs 3.67 lakh crore were sanctioned under the scheme, according to government data.
