PSB Digital Credit Assessment Model for MSMEs Explained
Why in the news
Public sector banks now assess MSME creditworthiness using digital footprints rather than paper files.
Key facts
- Announced in Union Budget 2024-25; live in all PSBs with varying loan thresholds.
- Inputs include GST via APIs, account aggregator bank data, PAN via NSDL, ITR, credit bureaus.
- Automated journeys for ETB and NTB borrowers.
Old versus new
| Aspect | Traditional | Digital |
|---|---|---|
| Process | Manual, paper | Automated |
| Time | Several days | 24 hours |
| Subjectivity | High | Rule-based |
Benefits
- Paperless, fewer branch visits.
- Instant in-principle sanction, transparent scorecards.
Exam angle
- Launch: March 6, 2025.
- Eligibility norms unchanged.