The new micro, small and medium enterprise (MSME) credit assessment model, based on digital footprints for public sector banks (PSBS), is expected to be launched by the end of March next year, sources in the know said.
"Almost half of the work has been completed, and we expect a launch by the end of this financial year (202425/FY25)," said a PSB official.
Finance Minister Nirmala Sitharaman, in the Union Budget for FY25, proposed that PSBs develop in-house capabilities to assess MSMEs for credit, moving away from external assessments. She also indicated that PSBS would lead the development or acquisition of a new credit assessment model based on scoring MSMEs' digital footprints.
"This is expected to be a major improvement over traditional credit assessment methods that rely solely on asset or turnover criteria. It will also encompass MSMEs without formal accounting systems," said Sitharaman.
Another senior official said, "Work is underway, and after its completion, we will conduct an audit and acceptance test.
The exact dates are yet to be determined, as we aim to ensure all aspects are thoroughly covered."
This story is from the September 02, 2024 edition of Business Standard.
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This story is from the September 02, 2024 edition of Business Standard.
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