Now universal enterprise IDs for small firms
ECONOMY & POLICY

Now universal enterprise IDs for small firms

According to an internal document, the Union government is working on a Universal Enterprise ID system to help strengthen the credit ratings of small businesses, which are the engines of the Indian economy.

A group of MSMEs will form a special purpose vehicle (SPV) under the proposal, which may be announced in the Union budget, to borrow from banks in a single transaction and on-lend to its members.

Credit rating agencies are also expected to develop new models for assessing the creditworthiness of MSMEs.

In 2019, an expert committee on micro, small, and medium enterprises (MSMEs) led by former Sebi chairman U.K. Sinha proposed the enterprise ID to improve credit availability to these entities. According to the 73rd round of the National Sample Survey, India has approximately 63.39 million MSMEs (NSS).

The Sinha committee recommended making MSME rating products more relevant and predictive of credit performance by encouraging rating agencies to build more 360-degree scoring models using newer data sources such as utility bills and tax payments, among others.

"The implementation of a Universal Enterprise ID will help this market. Rating agencies may need to develop newer offerings to encourage the growth of cash flow-based lending. "Banks must specify the workflow in their credit appraisal process if the MSME has a credit rating available to it," the committee stated in a report.

The Sinha committee report found that there is no common identifier through which an entity or enterprise can be recognised, referenced, and electronically verified, and enterprises "face problems when they approach other authorities for any permissions".

The panel sought to implement enterprise ID using PAN on a mission-mode basis in order to ensure credit availability to MSMEs.

Emails sent to the ministries of micro, small, and medium enterprises and finance went unanswered as of press time.

According to an internal document, the Union government is working on a Universal Enterprise ID system to help strengthen the credit ratings of small businesses, which are the engines of the Indian economy. A group of MSMEs will form a special purpose vehicle (SPV) under the proposal, which may be announced in the Union budget, to borrow from banks in a single transaction and on-lend to its members. Credit rating agencies are also expected to develop new models for assessing the creditworthiness of MSMEs. In 2019, an expert committee on micro, small, and medium enterprises (MSMEs) led by former Sebi chairman U.K. Sinha proposed the enterprise ID to improve credit availability to these entities. According to the 73rd round of the National Sample Survey, India has approximately 63.39 million MSMEs (NSS). The Sinha committee recommended making MSME rating products more relevant and predictive of credit performance by encouraging rating agencies to build more 360-degree scoring models using newer data sources such as utility bills and tax payments, among others. The implementation of a Universal Enterprise ID will help this market. Rating agencies may need to develop newer offerings to encourage the growth of cash flow-based lending. Banks must specify the workflow in their credit appraisal process if the MSME has a credit rating available to it, the committee stated in a report. The Sinha committee report found that there is no common identifier through which an entity or enterprise can be recognised, referenced, and electronically verified, and enterprises face problems when they approach other authorities for any permissions. The panel sought to implement enterprise ID using PAN on a mission-mode basis in order to ensure credit availability to MSMEs. Emails sent to the ministries of micro, small, and medium enterprises and finance went unanswered as of press time.

Related Stories

Gold Stories

Next Story
Products

Koemmerling opens Navi Mumbai experience centre

Koemmerling, a brand of the profine Group, has expanded its presence in the Mumbai metropolitan region with the opening of a new experience centre in Navi Mumbai and launched its Allure S46 minimal sliding door system for the Indian market.Located in CBD Belapur, the facility was inaugurated by Peter Mrosik, Owner and CEO, profine Group, along with Farid Khan, Chairman and Managing Director, profine India, and Kamal Bajaj, CEO, profine India.The company said the new centre will showcase its portfolio of uPVC and aluminium window and door systems to architects, developers and homeowners.The ina..

Next Story
Products

India's waterproofing market nears Rs 150 bn milestone

India's waterproofing industry is approaching a market size of Rs 150 billion and is expected to surpass the $2 billion milestone, according to speakers at the 2nd India International Waterproofers Conference & Expo 2026 organised by the Waterproofers Association of India (WAI) in New Delhi.The two-day event brought together more than 20 speakers, 55 international delegates and 53 exhibition booths, with discussions focusing on climate-resilient construction, advanced waterproofing technologies and international collaboration.Inaugurating the event, Durga Shanker Mishra, former Secretary, ..

Next Story
Real Estate

Dilip Buildcon Q1 FY27 Revenue at Rs 23.78 billion

Dilip Buildcon Limited reported consolidated revenue from operations of Rs 2,378 crore in Q1 FY27, along with EBITDA of Rs 429 crore and profit after tax of Rs 128 crore.Consolidated EBITDA margin stood at 18.1%, improving from 17.1% in Q4 FY26. On a standalone basis, revenue from operations was Rs 1,930 crore, EBITDA stood at Rs 199 crore and PAT was Rs 39 crore, with an EBITDA margin of 10.3%.The company’s order book stood at Rs 27,691 crore as of 30 June 2026, compared with Rs 28,830 crore as of 31 March 2026. Roads and highways accounted for 17.1% of the order book, irrigation and water ..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement