More Stories

Informist, Wednesday, Apr. 15, 2026

 

--Govt: Disbursed over INR 930 bln to MSMEs in Feb-Mar as credit guarantee 

--CONTEXT: Government officials briefing media on West Asia war 

--Govt: Working on new ECLGS scheme to boost credit to war-affected sectors 

 

NEW DELHI – The government disbursed over INR 930 billion to micro, small, and medium enterprises as credit guarantee during February and March to support them amidst the lingering uncertainty from the war in West Asia, Rajneesh, additional secretary in the Ministry of Micro, Small, and Medium Enterprises, said Wednesday. Total outstanding credit to such enterprises stands at over INR 36.70 trillion, Rajneesh said, adding that in Jan-Mar alone, the credit flow to them was up 23.5% on year.

 

"MSMEs are the core of the resilience of the Indian economy and the ministry is conducting stakeholder consultations regularly," the additional secretary said. Since the war in West Asia began Feb. 28, India has been exposed to energy supply and price shocks, given its dependence on countries in the Persian Gulf region for crude oil, liquefied petroleum gas, and liquefied natural gas supplies.

 

Micro, small, and medium enterprises have also been hit by supply shocks emanating from the war and its implications for prices of raw materials. As a retaliatory measure against the US and Israel, Iran shut the strategically important Strait of Hormuz, resulting in a sharp rise in crude oil prices. Crude oil prices surged to as high as $120 per barrel from $70 per barrel before the war. According to Rajneesh, the ministry made 37,000 tonnes of raw material available to micro, small, and medium enterprises in March, in the wake of the crisis, 12.5% higher than the quantity provided a year ago.

 

The Reserve Bank of India has also raised the collateral-free loan limit for micro, small, and medium enterprises to strengthen last-mile credit delivery for units with limited assets to provide as collateral, Rajneesh said. He said this will help small borrowers access more working capital. Starting Apr. 1, banks can give collateral-free loans of up to INR 2 million. The previous limit was INR 1 million.

 

Rajneesh said the government is also working on an Emergency Credit Line Guarantee Scheme, an initiative from the COVID-19 pandemic era, to support businesses amid the war. The scheme will include funds for war-affected sectors like shipping and aviation, he said. The contours are being finalised. Under the Emergency Credit Line Guarantee Scheme launched in 2020, the government had provided 100% guarantee on collateral-free loans to businesses facing liquidity crises due to COVID-19.  End

 

US$1 = INR 93.37

 

Reported by Priyasmita Dutta

Edited by Rajeev Pai

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

 

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2026. All rights reserved.