RBI Supporting Exporters Hit By US Tariffs; MSME Credit Grows Over 23% As Of Oct 31: RBI Guv

ENA MSME 2025-12-29 16:15:24 New Delhi, Dec 29 (KNN) Responding to concerns over Indian exporters facing pressure from US tariffs, Reserve Bank of India (RBI) Governor Sanjay Malhotra said the central bank has been providing support to sectors adversely affected by external developments. In an interview with India Today, he noted that the RBI has rolled out a series of relief measures, including loan moratoriums, to ease stress in impacted segments. Rate Transmission Largely Effective On monetary policy transmission, Malhotra said the RBI is broadly satisfied with the pass-through of interest rate cuts to borrowers, while acknowledging that some scope for improvement remains. Against a cumulative 100 basis points reduction in policy rates implemented earlier, data up to October indicate an average transmission of 78 basis points, which he described as strong. Transmission to micro, small and medium enterprises (MSMEs) stood at 83 basis points, supported by the linkage of most loans to external benchmarks such as the repo rate. Home loan rates declined by around 95 basis points. Malhotra added that further transmission is expected following the recent 25 basis points rate cut. MSME Credit Growth Remains Robust Malhotra reiterated that MSMEs continue to be a priority area for the RBI, alongside agriculture. Lending to the sector falls under priority sector norms, which mandate an overall target of 40 per cent of bank credit, including a 7.5 per cent sub-target for micro and small enterprises. As of October 31, credit to the MSME sector recorded growth of over 23 per cent. Within this, credit to micro and small enterprises grew by about 26 per cent, while medium enterprises saw growth exceeding 16 per cent. He said credit transmission in the sector has also been encouraging. Reforms Aimed at Expanding Formal Credit While noting the progress, Malhotra said the potential for expanding MSME credit remains significant. He pointed to initiatives such as the Unified Lending Interface (ULI), which is currently being implemented, and the Account Aggregator (AA) framework that enables seamless, consent-based data sharing. (KNN Bureau) 44579 https://knnindia.co.in/news/newsdetails/msme/rbi-supporting-exporters-hit-by-us-tariffs-msme-credit-grows-over-23-as-of-oct-31-rbi-guv 2025-12-29 16:15:24 knnindia.co.in RBI Supporting Exporters Hit By US Tariffs; MSME Credit Grows Over 23% As Of Oct 31: RBI Guv