Government rolls out new credit assessment model to streamline MSME lending
The launch comes as the government, the Reserve Bank of India (RBI), and the National Payments Corporation of India (NPCI) continue efforts to deepen and promote the adoption of digital payments across the country.
The government has introduced a new Credit Assessment Model (CAM), designed to make loan appraisal for Micro, Small and Medium Enterprises (MSMEs) faster, more transparent, and fully data-driven.
Announced on Tuesday, December 3, the CAM framework uses digitally-sourced, verifiable data available in the ecosystem to create automate loan-assessment journeys for MSMEs. It applies objective, model-based decisioning to evaluate all loan applications and then determine the credit limits for both Existing to Bank (ETB) as well as New to Bank (NTB) MSME borrowers.
The details were shared by Minister of State for Finance Pankaj Chaudhary in a written reply to the Rajya Sabha.
The launch comes as the government, the Reserve Bank of India (RBI), and the National Payments Corporation of India (NPCI) continue efforts to deepen and promote the adoption of digital payments across the country.
Ongoing initiatives include an incentive scheme to promote RuPay debit card usage and low-value BHIM-UPI (P2M) transactions, along with the Payments Infrastructure Development Fund (PIDF), to support the deployment of digital payment infrastructure, such as point-of-sale (POS) machines and QR codes, in the underserved regions.
Additionally, the government has also extended the Pradhan Mantri Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi) Scheme until March 31, 2030.
Implemented jointly by the Ministry of Housing and Urban Affairs and the Department of Financial Services, the scheme provides collateral-free loans of Rs 15,000, Rs 25,000 and Rs 50,000 across three tranches to street vendors. It also offers a UPI-linked RuPay credit card with a Rs 30,000 credit limit and cashback incentives on digital transactions.
Edited by Megha Reddy