365telugu.com online news,Mumbai, September 16, 2025: A new report from CRIF High Mark and SIDBI provides a comprehensive look at the state of small business credit in India. The CRIF–SIDBI Small Businesses Report 2025 highlights a period of strong expansion, with key insights into lending trends, regional performance, and improving credit quality.
Key Highlights of the Report
- Significant Credit Growth: The total outstanding credit for Micro, Small, and Medium Enterprises (MSMEs) with exposure up to ₹50 crore reached ₹36.8 lakh crore as of June 2025. This represents a compound annual growth rate (CAGR) of 21.8% over the last four years.
- Segment Performance: Sole proprietors make up the largest part of the market, holding over 75% of the outstanding credit. However, enterprises showed the fastest growth, with their portfolios expanding by 24.7% year-over-year.
- Lender Trends: Private banks have the largest market share in lending to enterprises, while Non-Banking Financial Companies (NBFCs) lead in lending to sole proprietors. Public Sector Undertaking (PSU) banks continue to be strong in smaller loans but have seen their overall market share decline.
- Improving Portfolio Quality: The report notes a significant improvement in credit quality. The share of “very-low-risk” borrowers increased from 46.5% to 54.2% for enterprises and from 34.7% to 40.0% for sole proprietors between June 2023 and June 2025. This indicates a more resilient and formalized credit ecosystem.
Uttar Pradesh Outpaces National Average
The report singles out Uttar Pradesh for its exceptional performance. The state’s small business credit portfolio grew by 20.7% year-over-year to ₹3.6 lakh crore, surpassing the national average.
Read This also… Joyalukkas Opens Second World-Class Showroom in Kukatpally, Hyderabad..
- Regional Growth: Industrial hubs like Gautam Buddha Nagar (33% YoY) and Ghaziabad (23.4% YoY) were major drivers of this growth.
- Better Credit Health: The state’s credit quality improved, with the Portfolio at Risk (PAR) for 91-180 days dropping from 2.0% in June 2023 to 1.5% in June 2025.
- Rural Penetration: Rural and semi-urban regions are playing a larger role, with aspirational districts contributing 4.1% of the state’s total exposure and growing by 17.4% year-over-year.