Govt Directs Banks To Digitise MSME Loans Up To Rs 1 Crore Via JanSamarth Portal

New Delhi, Jan 16 (KNN) The government has instructed state-owned banks to implement a uniform digital process for approving loans up to Rs 1 crore, with the goal of speeding up credit disbursement to micro and small enterprises (MSMEs), according to sources.

Integration with JanSamarth Portal

The complete lending process will be conducted via the JanSamarth portal, a digital platform for government-backed, credit-linked schemes. It enables banks to automatically access borrower information, including credit scores, income tax returns, GST data, and bank account details from various sources. 

“Since the portal can pull comprehensive borrower information, there can be a standardised process for loan appraisal and sanctioning,” said a senior bank executive. The initiative is expected to fast-track applications and reduce loan rejection rates.

MSME Credit Landscape

In FY25, banks extended roughly Rs 26.43 lakh crore in loans to MSMEs across 13 million accounts. The initiative aligns with the government’s push to strengthen the sector, expand digital lending, and adopt cash-flow-based underwriting for quicker, more efficient credit access.

(KNN Bureau)