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.

- Ad - - 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.

Help Opindia Reach Every Indian. Share This Post
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.

Big Story

The National Commission for Women (NCW) has taken cognisance of the complaint of sexual harassment that was made by one Himanshi Gupta against a senior producer of Kapil Sibal backed Tiranga TV.

2019 World Cup Is Here!

Catch the latest on Cricket World Cup as it unfolds, special coverage by Opindia

Proud to be a brand - Made in India?
Now, Advertise on Opindia

Abusive actor Ajaz Khan arrested by Mumbai Police for instigating violence through social media

Mumbai Police arrests small-time actor Ajaz Khan after he mocked the police on TikTok

Mangalore: Mohammad Ansari rapes a cow by tying its limbs, villagers catch him in the act, arrested

The villagers also made Ansari touch cow’s feet and ask for forgiveness for raping her. However, when Ansari approached the calf, the animal freaked out and started running.

Revisiting Sainbari, a blot on Indian Democracy: When Communists made a mother eat rice with her dead sons’ blood

The Sainbari incident remains the most horrific instance of political violence in the country.

Live updates Karnataka Trust Vote: Congress moves the Supreme Court to seek clarity on the whip issued to legislators, BJP delegation to meet the Guv

JDS-Congress government of Karnataka is facing their second floor test after assembly elections were held in May last year.

Mangaluru villagers caught Mohammad Ansari raping a calf, police arrests villagers for ‘hurting religious beliefs’

In the Kunjathbail village in Mangaluru, Mohammad Ansari was caught red-handed by the villagers while he was raping a calf.

Here are 15 famous quotes from Harsha Bhogle during his commentary stint

The famous Indian commentator, Harsha Bhogle, born on July 19 in Hyderabad is celebrating his 58th birthday today.
Tamil media on dead tiger

Tiger dies after eating a Sambar Deer, Tamil Media reports how it died after consuming ‘Sambhar Rice’

On Sunday evening, a tiger was found dead soon after it had eaten a sambar deer. The carcass was found in the Parsons Valley reservoir in the Nilgiris district.
Donald Trump took to Twitter to praise Pakistan for Hafiz Saeed' arrest

Hafiz Saeed was living freely in Pakistan, so hold your applause: US Committee gives Donald Trump a reality check

The US House Foreign Affairs Committee had to remind Donald Trump that Hafiz Saeed did not need any searching or finding so he should rather hold his applause.

Kapil Sibal claims Barkha Dutt was sacked before her tweets, won’t be paid anymore, Barkha says Sibal is lying

As Barkha had predicted, the Sibals also blamed the newly-elected Narendra Modi government for the advertisers to back off. Lack of advertising revenues led to deepening of their financial troubles, they claim. 

Hard Kaur supports pro-Khalistan ‘Referendum 2020’, extends support to banned terror outfit Sikhs For Justice

Taran Kaur Dhillon, popularly known as Hard Kaur, has landed herself in a new controversy. Kaur has taken to social media to extend her support to Khalistan.
Subscribe to Day's Top Stories
- Advertisment -

Latest articles

Connect with us

Help Opindia Reach Every Indian. Share This Post