India's small business sector has witnessed a remarkable rise in credit availability with the total credit reaching forty six lakh crore rupees in 2025. According to the latest CRIF High Mark SIDBI Small Business Spotlight Report, this represents a growth of over sixteen percent compared to the previous year. The expansion in credit demonstrates the increasing confidence of lenders and the growing demand from micro and small enterprises seeking financial support for business operations and expansion.
The number of active loan accounts has also seen significant growth, reaching over seven crore, indicating that more small businesses are entering the formal financial system. This expansion has been supported by government policies and targeted credit schemes aimed at strengthening the micro and small enterprise sector.
Importantly, the quality of loans has improved as overdue loans have declined, reflecting stronger repayment performance and better risk management among borrowers. The rise in credit is led by sole proprietors, but private banks, public sector banks, and non banking financial companies all play a crucial role in providing financial support.
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