Mumbai: CRIF High Mark and the Small Industries Development Bank of India (SIDBI) have jointly unveiled the first-ever CRIF SIDBI Small Businesses Report 2025, providing a detailed overview of India’s small business credit landscape.
The report covers enterprises and sole proprietors while analyzing growth patterns, sectoral distribution, lending practices, portfolio quality, and emerging risks.
Credit Expansion in Small Business Lending
According to the CRIF SIDBI Small Businesses Report 2025, outstanding small business credit stood at ₹36.8 lakh crore as of June 2025, recording a CAGR of 21.8% over the four years from June 2021.
Sole proprietors make up more than 75% of outstanding small business credit and account for over 85% of active loans. Enterprises, however, posted the fastest annual portfolio growth at 24.7%.
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Lender Market Share and Product Mix
The CRIF SIDBI Small Businesses Report 2025 highlights distinct patterns across lenders. Private banks lead enterprise lending with a 34.4% share of outstanding credit. NBFCs dominate the sole proprietor segment with 42.4% share and continue to expand across borrower categories. PSU banks maintain dominance in exposures below ₹10 lakh but face an overall market share decline.
Loans up to ₹10 lakh account for 72.5% of active loans but only 17.8% of outstanding value. Business Loans and Loans Against Property together constitute 50% of lending, with LAP showing the highest growth momentum.
CRIF SIDBI Small Businesses Report 2025: Sectoral and Regional Insights
The CRIF SIDBI Small Businesses Report 2025 reveals that the services sector increased its share from 25.6% to 27.8% between June 2023 and June 2025, overtaking manufacturing, which grew at 21% YoY. The trade sector registered a slight decline in share.
On the regional front, the top 10 states recorded strong YoY growth in small business credit. Uttar Pradesh led the list with 20.7% growth, taking its portfolio to ₹3.6 lakh crore. Within the state, Gautam Buddha Nagar (33% YoY) and Ghaziabad (23.4% YoY) registered significant growth.
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Aspirational districts contributed 4.1% of the state’s exposure, led by Shrawasti at 29.6% YoY. Maharashtra continues to be the largest small business credit market at ₹6.0 lakh crore, followed by Tamil Nadu, Gujarat, Uttar Pradesh, and Karnataka.
Improved Portfolio Quality and Financial Inclusion
The CRIF SIDBI Small Businesses Report 2025 highlights an improvement in portfolio quality, with national PAR 91–180 declining to 1.5% in June 2025 from 1.8% in June 2023. The share of very-low-risk borrowers rose to 54.2% for enterprises and 40.0% for sole proprietors.
The report also underlines deeper penetration in rural and semi-urban markets, signaling stronger financial inclusion and formalization within India’s small business ecosystem.
Sachin Seth, Chairman of CRIF High Mark and Regional Managing Director – CRIF India & South Asia, said, “Small businesses are a vital pillar of India’s economy. This study in partnership with SIDBI offers a clear, data-backed view of how the segment is expanding and evolving. The rise in very-low-risk borrowers and deeper penetration into rural and semi-urban areas reflects a more resilient and formalized credit ecosystem.”
