Over 3.96 Lakh MSME Loans Approved Under New Digital CAM By Public Sector Banks

New Delhi, Jan 19 (KNN) Public Sector Banks (PSBs) have sanctioned more than 3.96 lakh loan applications amounting to over Rs 52,300 crore to Micro, Small and Medium Enterprises (MSMEs) under a new digital Credit Assessment Model (CAM) between 1 April and 31 December 2025.

The CAM, introduced by PSBs in 2025, is based on digital credit underwriting and leverages the digital footprints of MSME borrowers to enable automated, data-driven loan appraisal. 

The model applies to both existing-to-bank (ETB) and new-to-bank (NTB) borrowers and is designed to streamline credit assessment through objective, model-based decision-making.

Under the framework, loan appraisal is carried out using digitally fetched and verifiable data available within the financial ecosystem. 

This includes KYC authentication, mobile and email verification, analysis of Goods and Services Tax (GST) data, bank statement analysis through the account aggregator framework, income tax return verification, credit information from Credit Information Companies, and automated fraud checks.

Loan applications are routed through the Jan Samarth Portal, which provides an end-to-end digital journey for MSME borrowers seeking loans within bank-defined thresholds. 

The system enables instant in-principle sanctions, faster processing of credit proposals and straight-through processing, while also integrating credit guarantee schemes such as the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE).

Officials said the digital model has reduced paperwork, minimised the need for branch visits and significantly shortened turnaround time for loan decisions. 

Borrowers can submit applications online at any time, upload required documents digitally and receive credit decisions immediately upon completion of the application process.

The initiative is aimed at improving access to formal credit for MSMEs by using transaction data and credit history to support faster, more transparent lending decisions, while enhancing operational efficiency for banks through automated underwriting and digital due diligence.

(KNN Bureau)