Home Economy and Finance GST resulted in 5 times increased lending to small businesses- SBI report

GST resulted in 5 times increased lending to small businesses- SBI report

The incremental credit to the MSMEs has shown an increase of 5 times reaching 1.23 lakh crores as compared to 25,700 crores during the corresponding period before GST, the report said.

According to a report of the State Bank of India (SBI) rolled out on Tuesday, the incremental credit to the Micro Small and Medium Enterprises has increased five times to 1.23 lakh crore post the implementation of Goods and Services Tax (GST).

The economists of the SBI dismissed the concerns over the credit supply to small businesses as a “myth” and said that the sector witnessed a “stupendous” loan growth post-GST. The report said that in the 15-month period after GST, the incremental credit to the MSMEs (under priority sector) has shown an increase of 5 times reaching 1.23 lakh crores as compared to 25,700 crores during the corresponding period before GST.

The report ascribed the deceleration in credit before the implementation of the GST partly to the overall slowdown in economic activity, rising Non-Performing Assets and the reclassification of food and agro-processing units from MSME category to the agriculture sector.

- Advertisement - - Article resumes -

At the RBI Central Board meeting in the month of November, the Board had asked the banks for some forbearance for classifying advances to MSMEs. There were reports also claiming that along with asset reclassification, there were concerns on credit flow to the sector considering the fact that there were 11 banks under the prompt corrective action framework. The liquidity issues faced by non-bank lenders, which amount to one of the largest credit suppliers to this sector, were also a reason to worry.

Regarding the overall 15% growth achieved by the industry in October, the report said that there has been a lot of fuss about the year-on-year growth being at a five-year high but it has, in fact, declined as compared to the proceeding month. However, there was a decline in credit growth for the same period in financial years 2017 and 2018.

“The good thing is that decline in incremental credit growth is seasonal and may not still be a matter of concern. We are not more concerned about the growth slowdown”, the report added.

Share This Post With Your Friends & Fans:
We need your support to survive in the media industry. Please consider paying us for the content we produce:

To know more about these payments, please click here.


Don't Miss it: Exit Polls At A Glance

#MakePoliticsFunAgain Catch all the Latest on exit polls results with our summary

Most read articles recently

Here is what may have triggered Rajdeep Sardesai’s own colleague slamming him for being a pliant journalist

Anjana Om Kashyap, one of the Editors of Aaj Tak who conducted that interview interestingly took to Twitter today to castigate what appears to be her colleague, Rajdeep Sardesai.

Read this before you believe the ABP-Nielsen Exit Poll that gave NDA only 277 while others gave a thumping majority

While all other polls were giving a thumping majority to BJP and NDA, Nielsen chose to "customise" their survey and simply delete voter responses were overwhelmingly in favour of BJP.
Ravish Kumar has a mental breakdown as BJP set to form a government at centre, according to exit polls

NDTV journalist Ravish Kumar has a prolonged meltdown on his show after the Exit Polls predicted a landslide BJP victory

Most of the Exit Polls suggested that BJP may be well placed to form another government at the centre

After Anjana Om Kashyap, now Shweta Singh calls out Rajdeep Sardesai’s bias among others

Sweta Singh has called out the blatant bias in the Left media and even Rajdeep Sardesai among others.

Congress must die: Expelled AAP leader and Swaraj India President Yogendra Yadav

Yogendra Yadav said Congress is single biggest obstacle for creating an alternative

‘Journalists’ now use the fall of the Left in Australia to console themselves and insinuate that Modi can meet the same fate

Shekhar Gupta has hinged his argument that exit polls are untrustworthy based on the recent Australian elections, in which conservative coalition registered a victory against popular opinion and exit polls

After 2019 Exit Polls, Congress official handle also says ‘Aayega To Modi Hi’

Looks like after the 2019 Exit Polls predicted a thumping majority for BJP and PM Modi, Congress too is saying #AayegaToModiHi. 

Sensing a possible Modi victory, Rajdeep Sardesai proceeds to discredit his own channel’s Exit Poll even before it is aired

Sensing that PM Modi might just come back to power for a second term, he has proceeded to discredit his own channel's Exit Poll which is yet to be aired.

Are we jokers?: Miffed, Congress ally and Karnataka CM reveals that the state is mulling law to control electronic media

Kumaraswamy reiterated that the media ignored his good deeds and instead focused on false reports
Subscribe to Day's Top Stories

Latest articles

Connect with us

163,681FansLike
139,483FollowersFollow
63,471SubscribersSubscribe

Don't miss these

Share This Post With Your Friends & Fans: