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MSME Credit Health Index 2021 : Latest Data

MSME Credit Health Index:

The latest MSME Credit Health Index indicates that MSME credit growth has accelerated in the quarter ending September 2020 as compared to the quarter ending in June 2020.

  • The Emergency Credit Line Guarantee Scheme (ECGLS) has helped in the credit growth for the Micro, Small and Medium Enterprises (MSME) sector.

About the MSME Credit Health Index:

  • Launch: The TransUnion CIBIL in partnership with the Ministry of Statistics & Programme Implementation (MoSPI) has launched the MSME Credit Health Index.
  • The Index is published quarterly.
  • Aim: To provide a measure of the growth and strength of the MSME sector in India.
  • The Index will provide government, policymakers, lenders, and MSME market participants, a numeric indicator for benchmarking the health of the MSME sector.
  • Measurement: The Index measures the credit health of India’s MSME industry on two parameters i.e, growth and strength.
  • Both the growth and strength indices follow the principle of higher the better.
  • Growth is measured by plotting an increase in exposure value (outstanding balances) over time.
  • An increasing Growth Index indicates an improvement in credit growth.
  • Strength is measured by a decrease/increase in credit risk in terms of non-performing assets (NPA).
  • An increasing Strength Index implies better asset quality and therefore denotes an improvement in the structural strength of the sector.
  • This measurement model will facilitate better MSME credit risk management, formulation of strategies and policies to support the revival and resurgence of the MSME sector and the economy.

Latest Data:

  • The overall growth index inched up to 114 points, which is a three-point increase from 111 in June 2020.
  • The overall Strength Index also improved to 89 from 83 over the same period.