India’s micro, small and medium enterprises (MSMEs) are once again at the heart of credit growth. According to a recent Crisil Intelligence report, MSMEs accounted for 32.5% of incremental bank lending between January and October 2025, nearly double their 17.7% share in the same period last year.
This sharp rise reflects a structural shift in how banks—particularly public sector banks—are deploying capital, as lending to large corporates remains measured amid subdued private capex cycles.
Why MSMEs Are Attracting More Bank Credit
The report highlights three key drivers behind this trend:
- Stronger disbursements by public sector banks, supported by cleaner balance sheets
- Improved formalisation and data visibility across MSMEs
- Policy support and credit guarantee frameworks that have reduced lender risk
At the same time, Crisil cautions against rising stress in small-ticket, unsecured MSME loans, underscoring the importance of prudent structuring and borrower–lender alignment.
Where OneNDF Fits Into This Shift
As MSME lending scales up, access alone is no longer the challenge—quality, structure, and suitability of credit are.
This is where platforms like OneNDF play a critical role in the evolving MSME credit ecosystem. By working across banks, NBFCs and alternative lenders, OneNDF helps MSMEs:
- Identify right-fit financing instead of one-size-fits-all loans
- Structure funding with appropriate security, tenure and cash-flow alignment
- Improve approval outcomes by addressing documentation, risk perception and lender expectations
In a credit environment where lenders are selectively expanding MSME exposure, well-prepared borrowers are seeing materially better terms—from pricing to timelines.
Broader Lending Trends: Secured Credit Gains Ground
Beyond MSMEs, Crisil notes a rise in secured retail lending, which now makes up 31.3% of incremental credit, while unsecured personal loans have moderated amid tighter underwriting norms.
Geographically, rural and semi-urban areas are seeing higher credit traction, indicating deeper penetration beyond metros.
The Road Ahead
The near-doubling of MSMEs’ share in incremental bank lending is a strong signal of confidence—but sustainability will depend on responsible underwriting and smarter borrowing.
As lenders grow more discerning, MSMEs that approach financing strategically—backed by the right advisory and lender access—will be best positioned to benefit from this renewed credit momentum.
At OneNDF, the focus remains on enabling this shift—by helping MSMEs convert credit availability into long-term financial strength.
