Priority bank credit to MSMEs jumps 18% in April from year-ago period: RBI data

In April 2024, gross bank credit to MSMEs under priority sector lending norms surged by 18.1%, totaling Rs 24.6 lakh crore compared to Rs 20.84 lakh crore in April 2023. Credit to micro and small enterprises (MSEs) rose by 18.6% to Rs 19.64 lakh crore, while medium-sized organizations saw a 16.5% increase to Rs 4.98 lakh crore. \r

However, Crisil anticipates a slowdown in bank credit growth to MSMEs in FY25, with an estimated decrease to around 15%, down from approximately 19% in fiscal 2024. Other priority sectors like agriculture and housing received Rs 20.60 lakh crore and Rs 7.53 lakh crore, respectively. \r

The government's amendment to the Income Tax Act aims to address delayed payments to MSMEs by allowing expenses to buyers within specified timelines.