Empathy and Innovation: Revamping Lending for MSMEs

Reserve Bank Deputy Governor Swaminathan J highlighted the need for empathy towards distressed MSMEs. At the SAC meeting, key issues like fair lending, transparency, and digital solutions were discussed to enhance credit flow and support economic growth. The RBI is committed to innovative credit initiatives.

Reserve Bank Deputy Governor Swaminathan J underscored the importance of empathy for distressed borrowers from small businesses, speaking at the 29th Standing Advisory Committee meeting in Ahmedabad.

Swaminathan emphasized the crucial role of MSMEs in driving India's economic development, urging lenders to prioritize fair lending practices and transparency. The meeting also focused on strategies for reviving financially distressed MSMEs.

The RBI pledged to boost institutional credit support through tools like the Unified Lending Interface and Account Aggregator framework, while addressing challenges such as financial literacy gaps and delayed payments. It highlighted the need for digital solutions and participation in platforms like TReDS.

(With inputs from agencies.)