The Ministry of Finance on Monday said public sector banks have sanctioned nearly 396,000 MSME loan applications amounting to more than Rs 523 billion under digital credit underwriting programmes between April 1 and December 31, 2025.

The government said it has been making sustained efforts to strengthen small businesses across the country, with a particular focus on improving access to credit for micro, small and medium enterprises through technology-driven lending models.

Public sector banks launched the Credit Assessment Model in 2025 to digitally underwrite MSME loans based on borrowers’ digital footprints. According to the finance ministry, the model leverages digitally fetched and verifiable data available within the ecosystem to create automated loan appraisal journeys. It enables objective decision-making for all applications and model-based assessment of credit limits for both existing-to-bank and new-to-bank MSME borrowers.

In its statement, the ministry said that the adoption of the digital credit assessment framework has helped speed up loan processing while ensuring consistency and transparency in lending decisions. Between April 1 and December 31, 2025, public sector banks sanctioned MSME loans worth over Rs 523 billion under these digital underwriting programmes, reflecting growing traction for technology-led credit delivery.