New Delhi

The Economic Survey 2026 highlighted that the bank credit to Micro, Small, and Medium Enterprises (MSMEs) are rising strongly, with policy push through guarantees, digital lending platforms and priority-sector norms.

The YoY growth trend in credit for industry and services has demonstrated a moderate increase in FY26 thus far, within industry, the bank credit to the MSME sector continues to show momentum and remains robust.

In November 2025, bank credit to this sector increased by 21.8% compared to a 13% increase in November 2024. Within the MSME sector, the credit extended to the micro and small enterprises has registered an increase of 24.6% (YoY) in November 2025, up from 10.2% in November 2024, data released by the Economic Survey said.

It further highlighted that certain regulatory measures, such as revised guidelines on voluntary pledge of gold and silver jewellery as collateral for small business loans, have helped in improving credit flow to the MSME segment.

Furthermore, measures announced in the Union Budget 2025-26, such as a significant enhancement of credit availability with guarantee cover for MSMEs, the introduction of credit cards for micro-enterprises, and others, have also been beneficial to the sector.

The revision in MSMEs classification, wherein investment limits and turnover thresholds have been substantially raised, also contributed to this high growth.

The Economic Survey also highlighted the launch of the credit assessment model (CAM) by the public sector banks (PSBs) based on the digital footprints for MSMEs in 2025.

This model leveraged digitally fetched and verifiable data to enable automated loan appraisal for MSMEs, utilising objective decisioning for all loan applications and model-based limit assessment for both existing-to-bank and new-to-bank MSME borrowers. Along with improving the ease of doing business for the MSMEs, this model also integrates the credit guarantee schemes, such as the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE).

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"Between 1 April and 30 November 2025, over Rs 3.2 lakh crore MSME loan applications, amounting to more than Rs 41.5 thousand crore, have been sanctioned by PSBs under the credit programmes of CAM," the data released from the survey said.

Measures targeted at MSMEs, including expanded credit guarantees, wider use of TReDS and the rollout of the Unified Lending Interface (ULI), have sought to ease credit constraints.