83% Msmes Report Easy Credit Access, Says UGRO Capital MSME Sampark Report

(MENAFN- KNN India) New Delhi, Jan 19 (KNN) UGRO Capital Ltd., a non-banking financial company focused on MSME lending, has released the fourth edition of the MSME Sampark Report, in collaboration with Dun & Bradstreet.

The report draws on analysis of over 73,000 firms across eight sectors and a nationwide survey of over 5,000 MSMEs, assessing the impact of global trade disruptions while highlighting rising resilience in India's domestic market.

Credit Access Remains Strong

The report said about 83 percent of surveyed MSMEs reported easy access to credit, with non-banking financial companies being the preferred funding source, reported The Economic Times.

UGRO Capital Founder and Managing Director Shachindra Nath said the findings highlight the need for closer collaboration among banks, NBFCs, policymakers and entrepreneurs to build a transparent, tech-driven credit ecosystem, adding that India's MSME sector remains resilient despite global and sectoral challenges.

Arun Singh, Global Chief Economist, Dun & Bradstreet, said MSME business optimism has softened amid global trade uncertainties, but stronger expectations for domestic orders reflect confidence in India's economy, supported by healthy industrial output and stable prices.

Growing Contribution to the Economy

The report noted that MSMEs' share in India's GDP has steadily risen from 27.3 percent in FY21 to about 30 percent in FY25, driven by greater formalisation, better access to credit and stronger domestic demand.

Micro manufacturing enterprises faced revenue stress in FY24, especially in automotive, chemicals, education, electrical equipment and light engineering, due to global trade uncertainty, supply chain disruptions and pressure from low-cost imports.

Credit to micro and small enterprises rose 12 percent year-on-year, surpassing growth in lending to medium firms and the overall banking system, with both secured and unsecured loans increasing, particularly in healthcare, electrical equipment and chemicals.

Formalisation is increasing, with Udyam registrations rising 18 percent from 58.46 million in January 2025 to 68.85 million by September 2025, indicating deeper MSME integration into the formal economy and better access to finance and government support.

Impact of Global Trade Shifts

The report said MSMEs remain exposed to global trade shifts, with higher US tariffs hurting sectors such as textiles, gems and jewellery, auto components, and agri-marine exports, weighing on export revenues, especially for smaller firms with limited market diversification.

Globally, countries such as Thailand, Taiwan, China and Brazil have rolled out targeted MSME support measures, including credit, export guarantees, subsidies and digital skilling.

In India, GST tweaks, rate cuts and export diversification efforts have helped offset global headwinds, with MSMEs remaining optimistic on domestic demand amid steady industrial growth and stable prices.

(KNN Bureau)

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