MSME Sector India’s 'Entrepreneurship Nursery' And Vital For Growth: RBI Governor

New Delhi, Jun 22 (KNN) Reserve Bank of India (RBI) Governor Sanjay Malhotra on Sunday reaffirmed the central bank's commitment to supporting the Micro, Small and Medium Enterprises (MSME) sector, describing it as India's ‘entrepreneurship nursery’ and a vital driver of economic growth and employment generation.
 
Malhotra said MSMEs occupy a critical position in the Indian economy by creating livelihoods, fostering innovation and enabling entrepreneurial aspirations across the country, reported ANI.
 
RBI Observing MSME Awareness Week
 
The Governor noted that the RBI is observing a dedicated awareness week to disseminate information about various MSME-focused schemes and regulatory initiatives undertaken by the central bank to strengthen the sector.
 
He said the RBI has consistently worked over several decades to improve the ecosystem for small businesses through measures aimed at enhancing access to institutional credit.
 
"Over the last many decades, RBI has been promoting the development of MSMEs. A number of schemes and measures have been taken by RBI to improve the flow of credit to MSMEs," Malhotra said.
 
MSMEs Play a Critical Role in the Economy
 
According to government data, the MSME sector contributes around 31.1 percent to India's Gross Domestic Product (GDP) and accounts for 48.58 percent of the country's total exports.
 
The sector comprises more than 7.47 crore enterprises operating across manufacturing, trade and services, generating nearly 35.4 percent of India's manufacturing output and supporting the livelihoods of approximately 32.8 crore people. It remains the country's second-largest source of employment after agriculture.
 
Formalisation Efforts Gain Momentum
 
Highlighting recent policy interventions, Malhotra said efforts have increasingly focused on bringing informal enterprises into the formal economy to improve their access to financial services and government support.
 
As of March 2026, more than 7.9 crore MSMEs and informal micro-enterprises had been registered through the Udyam and Udyam Assist platforms, according to official data.
 
Digital Platforms Strengthen MSME Ecosystem
 
He added that digital initiatives such as the Government e-Marketplace (GeM), Trade Receivables Discounting System (TReDS) and the MSME SAMADHAAN portal have strengthened market access, improved payment mechanisms and provided quicker dispute resolution avenues for small businesses.
 
Malhotra reiterated that the RBI will continue to support the sector through appropriate policy measures and regulatory interventions in the years ahead.
 
(KNN Bureau)