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MSME Credit Assessment Model Using Digital Footprints

7 March 20251 min read
BANKING & FINANCEMSME CreditAssessment ModelUsing DigitalFootprints7 March 2025safalsetu.com

Why in the news

A credit model based on MSME digital footprints, announced in Union Budget 2024-25, was rolled out for public sector banks.

Key facts

  • Aim: in-house assessment by PSBs, with no dependence on outside agencies.
  • Automated for Existing to Bank (ETB) and New to Bank (NTB) customers.
  • Data: PAN (NSDL), OTP-verified mobile and email, GST, Account Aggregator bank statements, ITR, bureau APIs and fraud checks.

Significance

  • Faster, more objective loan decisions and better financial inclusion for small businesses.
  • Lower fraud risk and stronger PSB capability.

Exam angle

  • Announced in Budget 2024-25; users: PSBs; terms: ETB, NTB, Account Aggregator.

Test yourself

1. Who launched the digital footprint-based credit assessment model for MSMEs at Visakhapatnam?

The Union Finance Minister launched it at a post-Budget interaction.

2. In which Union Budget was the digital footprint-based MSME credit assessment model announced?

The notes state it was announced in Union Budget 2024-25.

3. In the MSME credit assessment model, bank statement analysis is done through which mechanism?

Bank statements are analysed through Account Aggregators; NSDL handles PAN authentication.

This topic is part of Daily Current Affairs 7 March 2025 (15 topics).

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