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New Delhi, July 28 MSME segment's credit demand has seen a sharp surge post unlock exercise, a SIDBI-TransUnion CIBIL MSME Pulse report said.The report showed a significant surge in credit demand post unlocks after the first and second wave of the pandemic.In March 2021, commercial credit enquiries were at 32 per cent over pre-Covid-19 levels.This strong momentum, the report said, was impacted by the second wave, but June 2021 again showed a sharp recovery to pre-Covid-19 levels.SIDBI Chairman and Managing Director Sivasubramanian Ramann said: "The MSME credit data speaks volumes of success of ECLGS scheme. The scheme has played a major role in 40 per cent YoY growth in disbursements to the sector, thereby reviving the business sentiments among the MSMEs.""The key highlight which signals the revival is credit to new-to-bank (NTB) which has returned back to pre-Covid levels, while credit to existing-to-bank (ETB) remains buoyant."Besides, Ramann said that recent additional relief measures by government, especially in healthcare, travel and tourism, are expected to improve credit offtake in the MSME sector."Going forward, the lenders need to continuously monitor the health of credit portfolios, while sustaining credit growth to MSMEs."Furthermore, the report cited that profile of MSME borrowers getting fresh loans has changed in 2021."Post-Covid wave-1, there is a reduction in new originations on high-risk MSME entities (CMR 8-10). This reduction is offset by an increase in originations in CMR 6-7, implying lenders have reduced risk appetite in the current uncertain environment.""On the other hand, the analysis brings forth the fact that finding high ranking MSMEs is harder."In FY21, loans worth Rs 9.5 lakh crore were disbursed to MSMEs.This amount was much higher than the preceding year- FY20, when loans amounting to Rs 6.8 lakh crore were disbursed.In addition, the report pointed out that government interventions, like the Emergency Credit Line Guarantee Scheme (ECLGS) under the AtmaNirbhar Bharat programme, was the major factor in driving this significant surge in credit disbursement to MSMEs."The total on-balance sheet commercial lending exposure in India stood at Rs 74.36 lakh crore in March '21, with YOY growth rate of 0.6 per cent.""MSME segment's credit exposure stood at Rs 20.21 lakh crore as of March '21, showing YOY growth rate of 6.6 per cent. This credit growth is observed across all the sub segments of MSME lending."Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

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International :MSME credit demand surges as markets reopen in June: Report

New Delhi, July 28 MSME segment's credit demand has seen a sharp surge post unlock exercise, a SIDBI-TransUnion ... ...