Ahmedabad: In the last few years, access to formal loans for micro, small and medium enterprises (MSMEs) in India has been increasing. Due to this, MSME’s stake in getting loans from scheduled banks has increased considerably.
The report released by the NITI Aayog on increasing the competitiveness of MSME in India today presented a wide blueprint to open India’s immense capacity of MSME through systematic reforms in loans, skills, innovations and market access.
The report said that there has been a significant improvement in access to the formal loans of MSME. The share of micro and small enterprises receiving loans from scheduled banks has increased from 14 percent to 20 percent between 2020 and 2024. During the same period, medium enterprises borrowed from scheduled banks increased from 4 percent to 9 percent.
Despite these reforms, the report shows that the big difference in debt still remains. In the financial year 2017, loan demand for MSME sector Rs. 69.3 lakh crores Out of this, 10.9 lakh crore rupees came from formal sources and 58.4 lakh crore rupees from informal sources. Thus the loan difference is Rs. It has increased to 58.4 crores.
Only 19 percent of MSME loan demand was formally completed by FY1 21. The demand for MSME loan was recorded at Rs 99 lakh crore in the financial year. In which MSME received Rs 19 lakh crore from formal sources.
The report also states that MSME is facing obstacles in adopting modern technology due to severe power shortage, poor internet connectivity and high implementation costs.
