RBI ESINABARD ESISEBI
In one line
This initiative is expected to enhance financial accessibility for MSMEs, supporting their expansion and contribution to the Indian economy.
Key Highlights
- Launched by: Union Finance Minister Nirmala Sitharaman
- Event: Post-Budget interaction in Visakhapatnam
- Announced in: Union Budget 2024-25
- Objective: Enable Public Sector Banks (PSBs) to conduct in-house MSME credit assessment, reducing reliance on external agencies.
How the New Credit Model Works
- Uses MSME Digital Footprints to determine creditworthiness.
- Automated loan assessment for both:
- Existing to Bank (ETB) borrowers
- New to Bank (NTB) borrowers
- Data Sources for Credit Scoring:
- PAN authentication via NSDL
- Mobile & email verification (OTP-based)
- GST data via service providers
- Bank statement analysis through Account Aggregators
- Income Tax Return (ITR) verification
- API-enabled commercial & consumer credit bureau checks
- Fraud detection & hunter checks via APIs
Significance & Expected Impact
- Faster, automated loan approvals for MSMEs.
- More objective & transparent credit decisions.
- Boosts financial inclusion by facilitating credit for small businesses.
- Strengthens PSBs’ capability to evaluate MSME loans without external dependency.
Government’s Vision
- Encourage digital transformation in MSME lending.
- Ensure easier access to credit, fostering growth in the MSME sector.
- Improve efficiency & reduce fraud risks in loan approvals.