New Delhi [India], October 7 (ANI): Around ₹8 trillion in credit has been extended to India’s micro, small, and medium enterprises (MSMEs) over the past three years, supported by Reserve Bank of India (RBI) and government initiatives, enhancing access to finance, enabling business expansion, and boosting participation in public procurement, Girish Luthra, President of FICCI-CMSME, said.
Speaking on the sidelines of the 11th FICCI-CMSME Summit in New Delhi, Luthra said, “RBI, together with the Government of India, has been working closely to make finance easier for MSMEs. One major challenge was related to guarantees or collateral requirements. The government addressed this by creating a threshold — initially ₹1 crore, now up to ₹10 crores — where MSMEs can access funds without collateral.”
He noted that the introduction of digital platforms such as the Government e-Marketplace (GeM) has further enhanced MSME growth. “GeM and its sustainability focus are making a real difference for MSMEs. With over six million enterprises forming the backbone of this sector, FICCI-CMSME is the only large confederation exclusively focusing on their growth. Government support has been invaluable,” Luthra said.
Highlighting MSMEs’ role in public procurement, Luthra added, “Today, almost 45% of public procurement is done through MSMEs, and we truly appreciate the government’s efforts in this regard.”
Addressing concerns about non-performing assets (NPAs), he said, “It’s a common misunderstanding that MSMEs contribute heavily to NPAs. In reality, NPAs in the MSME sector are only 3.9%, far lower than in large organisations. This low risk is why the RBI supports collateral-free funding for MSMEs.”
On ease of doing business, Luthra remarked, “Interstate competition is improving outcomes because states want to perform better. Implementation happens at the state level, and this competition is proving very effective.”
Regarding domestic challenges, he noted, “Labour reforms over the past two years have significantly reduced production losses due to workforce issues. Similarly, state governments are relaxing land laws, and cluster-based industrial models now allow MSMEs to set up plug-and-play operations with cleared titles — the most effective model.”
Stressing the need for awareness, Luthra said, “The government has excellent MSME policies, but many enterprises are unaware of them.” He added that FICCI-CMSME is collaborating with the Ministry of MSME and NSIC to organise 100–200 outreach programmes across the country to improve awareness and participation.
This credit expansion and policy support, Luthra said, will strengthen MSMEs as a vital driver of India’s economic growth and innovation ecosystem.
About The Author
