Government Launches Credit Assessment Model to Boost MSME Lending

The government has introduced a new Credit Assessment Model (CAM) to streamline loan appraisal for Micro, Small and Medium Enterprises. The digital-first framework marks a major step towards objective, technology-driven credit evaluation for both existing and new borrowers.

Automated and Data-Driven Loan Appraisal

CAM uses digitally verifiable data from various ecosystem sources to automate MSME loan assessment. The model enables uniform decision-making, provides model-based limit evaluation and reduces manual intervention for both Existing-to-Bank and New-to-Bank applicants, improving speed and transparency in credit delivery.

Support for Digital Payments Infrastructure

Parallel to credit reforms, the Government, RBI and NPCI continue to promote digital payment adoption. Key measures include incentives for RuPay debit card and low-value BHIM-UPI (P2M) transactions, as well as the Payments Infrastructure Development Fund, which aids deployment of POS terminals and QR codes in underserved regions.

Expansion of PM SVANidhi Scheme

The PM SVANidhi scheme for street vendors, launched in 2020, has been extended to 31 March 2030. Implemented jointly by MoHUA and the Department of Financial Services, the scheme now offers enhanced loan amounts of ₹15,000, ₹25,000 and ₹50,000 across three tranches. Additional provisions include a RuPay credit card linked to UPI with a ₹30,000 limit and cashback incentives to encourage digital transactions.

Exam Oriented Facts

• CAM provides automated MSME credit appraisal using digital and verifiable data.
• Digital payment promotion includes RuPay and BHIM-UPI incentives and PIDF support.
• PM SVANidhi extended to March 2030 with loan slabs of ₹15k, ₹25k and ₹50k.
• UPI-linked RuPay credit card under PM SVANidhi carries a ₹30,000 limit.

Government’s Commitment to Inclusive Financial Access

Minister of State for Finance Pankaj Chaudhary informed the Rajya Sabha that these measures aim to strengthen MSME credit flow, accelerate digital adoption and empower street vendors through expanded financial support and digital tools.