Recent dialogue among Micro, Small, and Medium Enterprises (MSMEs) has highlighted the pressing need for government intervention amid ongoing geopolitical uncertainties. The Standing Advisory Committee (SAC) convened under Reserve Bank of India (RBI) Deputy Governor Swaminathan J in Coimbatore addressed these challenges on October 27, 2025.
Key Discussions at the SAC Meeting
The 30th SAC meeting primarily focused on enhancing credit flow to the MSME sector. Mr. Swaminathan underscored the crucial position of MSMEs in driving India’s economic development and regional diversification.
Government Support for MSMEs
The RBI emphasized its commitment to fortifying the credit ecosystem for MSMEs. Significant initiatives mentioned included:
- Unified Lending Interface (ULI)
- Account Aggregator framework
- Regulatory Sandbox
These initiatives promote cash-flow based and data-driven lending, essential for the sector’s growth.
Recent Regulatory Measures
Mr. Swaminathan also pointed to recent measures aimed at easing operational burdens for MSMEs:
- Waiver of prepayment charges on floating-rate loans for individuals and small enterprises.
- Relaxation of reporting under the Export and Import Data Processing and Monitoring System (EDPMS/IDPMS) to help small importers and exporters reduce compliance costs.
Addressing Challenges in the Sector
The meeting addressed information asymmetry, financial literacy gaps, and delayed payments. Mr. Swaminathan advocated for the broader adoption of digital solutions such as:
- Trade Receivables Discounting System (TReDS)
He urged the adoption of alternative credit assessment models and the promotion of transparent lending practices to aid the rehabilitation of viable MSME units.
Collaborative Efforts Needed
Mr. Swaminathan encouraged MSME organizations to take an active role in capacity building and bridging information gaps. This collaboration is essential for helping enterprises access formal financial channels effectively.
Participants at the Meeting
The meeting brought together stakeholders from various sectors, including:
- Executive Directors from RBI
- Officials from the Ministry of MSME
- Representatives from leading banks and financial institutions
- Members of MSME associations
These discussions aimed to improve credit flows, accelerate the adoption of TReDS, and enhance the utilization of credit guarantee schemes.
Conclusion
The SAC’s discussions reflect a proactive approach to addressing the challenges faced by MSMEs in the current geopolitical climate. Continuous collaboration among government bodies, financial institutions, and MSME associations is vital for fostering a resilient and robust MSME sector.
