By Lakshmi Venkataraman Venkatesan, Founding and Managing Trustee, Bharatiya Yuva Shakti Trust.
“The RBI’s decision to keep the repo rate unchanged at 5.25% reflects a calibrated and balanced approach amid resilient growth and continued inflation risks from crude oil prices, food inflation, rupee movement, supply chain disruptions, and global uncertainty. For micro and small entrepreneurs, a pause provides much-needed predictability. Stable borrowing costs help entrepreneurs plan cash flows, manage inventory, honour repayment commitments, price their products more confidently and take informed decisions on expansion, hiring, and technology investments. When lending conditions remain predictable, MSMEs are better placed to manage long-term contracts, avoid sudden debt-service pressure and plan working capital requirements with greater confidence. Given the MSME sector’s contribution to manufacturing, exports and GDP, predictable credit conditions are critical to sustaining enterprise confidence and growth. This pause should be used to strengthen credit transmission, last-mile access, working capital support, repayment flexibility, and mentoring-led guidance. India’s growth story will be stronger when micro-entrepreneurs are not only included in formal credit systems but actively supported to grow within them.”