TransUnion CIBIL Hosts ‘MSME Conclave: Enabling Credit for Developing Bharat’ in Bengaluru

Bengaluru, 22nd October 2024: As India moves towards becoming a economy by 2030, it is essential to ensure an unhindered flow of credit to the Micro Small and Medium Enterprises (MSME) sector. To further this lending objective, TransUnion CIBIL hosted one of its multi-city ‘MSME Conclave: Enabling Credit for Developing Bharat’, in Bengaluru today.

The TransUnion CIBIL MSME Conclave underlines the importance of the MSME sector which contributes significantly to the country’s GDP growth by generating employment, promoting regional development, bridging the income gap and encouraging innovation and entrepreneurship. Its objective is to empower MSME lenders across the country with insights and deeper understanding of information and analytics solutions for driving access to finance for MSMEs while ensuring sustainable MSME credit portfolio growth.

Mr. Manas Ranjan Mishra, Business Development, Bank of Baroda and Mr. Anuj Gupta, Chief Risk Officer, Credit Saison India – participated in the panel discussion. Senior officials from banks and credit institutions in the region attended the conclave.

Private sector banks lead MSME lending in Karnataka

Private sector banks continue to be the biggest lender segment for MSMEs in Karnataka, holding a 30% share of total lending in the quarter ending June 2024. The majority of loans disbursed were to the Manufacturing Sector at 24%, with Unsecured Business Loans accounting for 28% of total MSME loans disbursed in the state. Indicating strong asset quality, the share of loans to the low-risk segment i.e., CIBIL MSME Rank (CMR) 1-3 was highest at 49%.

The top cities in Karnataka with the highest MSME loan disbursement are Bengaluru, Mysuru, Hubli-Dharwad and Mangaluru. The state-wide trend of Private sector banks garnering the highest share in lending to MSMEs was reflected in two of these cities: Bengaluru at 35% and Hubli-Dharwad at 40%. However, Public sector banks had a higher share of MSME loans in Mysuru at 35% and Mangaluru at 52%.

CIBIL MSME Rank and Commercial Credit Report

The CIBIL MSME Rank and Commercial Credit Report play an important role in easing flow of credit to the MSME sector. They assist credit institutions in formulating risk policies, enabling quick and easy sanction and disbursement of loans and ensuring judicious portfolio management.

The Commercial Credit Report includes detailed information on an MSME’s credit history, including the nature and amount of credit facilities availed, repayment patterns, and current obligations. It also reflects any defaults or delays in payments. This report provides credit institutions with a clear picture of the company’s credit behaviour, helping them assess the credit risk.

The CIBIL MSME Rank ranges from 10 to 1, with 1 being the best rank possible. It provides a single number summary of the Credit Information Report of MSMEs, encapsulating the credit history and loan repayment behaviour of the business. This rank is only available for companies with a current credit exposure .

Continuing with the commitment of supporting credit institutions in MSME lending for enabling credit to Bharat, TransUnion CIBIL will be hosting the series of this MSME conclave across India.