New Delhi, Jan 19 (UNI) Public Sector Banks (PSBs) have significantly accelerated credit flow to Micro, Small and Medium Enterprises (MSMEs) through the adoption of a Credit Assessment Model (CAM) based on digital footprints, launched in 2025.
Between 1 April and 31 December 2025, PSBs sanctioned over 3.96 lakh MSME loan applications, amounting to more than Rs 52,300 crore, under various digital credit underwriting programmes.
The CAM framework leverages digitally fetched and verifiable data available across the financial ecosystem to enable automated MSME loan appraisal. The model uses objective decision-making and model-based limit assessment for both Existing to Bank (ETB) and New to Bank (NTB) borrowers, ensuring faster and more transparent credit decisions. Under this system, digital footprints are utilised for multiple stages of credit evaluation, including KYC authentication, mobile and email verification, GST data analysis, bank statement analysis through Account Aggregators, Income Tax Return (ITR) verification, credit history checks using Credit Information Companies (CICs), and fraud detection.
As per the statement released by the Ministry of Finance, the digital model has brought substantial benefits to MSMEs by enabling online loan applications from anywhere, significantly reducing paperwork and branch visits, and providing instant in-principle sanctions. The end-to-end straight-through processing (STP) has led to a sharp reduction in turnaround time (TAT) and improved efficiency in credit delivery.
The key features included instant in-principle sanction for MSME loans based on digital data such as GST, ITR, bank account statements and CIC reports; End-to-end digital loan journey through the Jan Samarth Portal for loan amounts within bank-defined thresholds.
Further the API-based digital due diligence using verified data sources, and faster decision-making with seamless integration of credit guarantee schemes like CGTMSE are also feasible. As per the statement, the scheme will provide benefits to the MSMEs like no requirement for branch visits; MSME promoters can apply for loans 24×7 from any location; Online document upload facility, eliminating the need for physical submission during loan approval.
It also provides immediate communication of loan decisions upon completion of applications, enhancing transparency and reducing processing time. The digital credit assessment initiative is expected to further strengthen MSME financing by making credit more accessible, faster, and data-driven, while supporting the broader goal of financial inclusion and ease of doing business.
