Mumbai: CRIF High Mark, a leading Indian credit bureau, has unveiled the MSMEx Spotlight Report – June 2025, presenting a detailed view of the evolving credit landscape for Micro, Small, and Medium Enterprises (MSMEs).
According to the MSMEx Spotlight Report, India’s MSME credit exposure surged to ₹40.4 lakh crore as of March 2025 – registering a robust 20.1% year-on-year growth. This expansion reflects rising lender confidence, improved digital infrastructure, and stronger financial inclusion initiatives.
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The MSMEx Spotlight Report indicates that micro businesses dominate in terms of loan volume, comprising 81.1% of active loans, while small businesses lead by value, holding 39.9% of the total portfolio. This growth trajectory has been significantly supported by the Udyam and Udyam Assist platforms, which now boast over 6.4 crore registered enterprises.
One of the report’s standout findings is the growing formalization among MSMEs. Proprietorships within the micro segment declined from 65% to 62.8% over the last two years, while private limited firms increased from 5.5% to 7.3%.
This shift suggests a positive trend toward structured business models, aided by digital onboarding and policy frameworks like Udyam Assist.
On the lending front:
- Public sector banks continue to dominate micro business lending with 45% market share.
- Private sector banks lead the small and medium segments with a 50% share in credit outstanding.
- NBFCs are expanding steadily, leveraging regulatory support such as priority sector lending norms for on-lending.
Credit product trends also reflect changing borrower-lender dynamics:
- Working capital loans remain the largest segment at over 50%.
- Term loans for micro businesses increased from 37.5% to 39.7% in two years.
- Unsecured business loans surged from 5% to 8.5%, thanks to digital lenders offering fast, small-ticket loans.
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Geographically, Maharashtra tops the chart with ₹6.2 lakh crore in credit exposure, followed by Gujarat, Tamil Nadu, and Uttar Pradesh. Notably, Tamil Nadu recorded improved asset quality, with delinquency in the 91–180 days past due (DPD) bucket dropping from 2.4% to 2.0% year-on-year.
“India’s micro businesses continue to be the cornerstone of our credit economy,” said Sachin Seth, Chairman of CRIF High Mark and Regional MD – India & South Asia, CRIF.
“With over 174 lakh active loans and ₹10.8 lakh crore in total exposure, micro enterprises are scaling both in size and financial sophistication. Rising digital adoption and growing confidence in unsecured lending are clear signs of a maturing ecosystem.”
MSMEx Spotlight Report: CRIF High Mark’s Flagship Publication
The MSMEx Spotlight Report is CRIF High Mark’s flagship publication, offering data-driven insights for banks, NBFCs, policymakers, and regulators. Built on granular credit bureau data, the report supports informed decision-making and responsible credit growth across India’s diverse MSME ecosystem.
