Union Budget: Continuation of credit guarantee relief for MSMEs

Credit to micro, small and medium enterprises (MSMEs) will get a boost with the continuation of the credit guarantee scheme that could facilitate nearly ₹2 lakh crore of loans to the vital sector.

"Support to the MSME sector along with enhancement of credit guarantee scheme will provide much-needed relief to the sector," said Chandra Shekhar Ghosh, MD, Bandhan Bank.

Last year, the finance minister had proposed revamping the credit guarantee scheme for MSMEs.

"The revamped scheme will take effect from April 1, 2023, through infusion of ₹9,000 crore in the corpus. This will enable additional collateral-free guaranteed credit of ₹2 lakh crore," she said.
"The continuation of credit guarantee scheme for MSME lending in addition to digitalisation of documents for MSME lending and computerisation of agricultural cooperatives are likely to support credit off-take," said Karthik Srinivasan, senior VP and group head of financial sector ratings, Icra.