The Parliamentary Standing Committee on Finance in India has recommended providing a credit card to MSME owners, which will ensure access to regular credit to small businesses while facilitating a mechanism for payment scores. Chairman of the Committee Jayant Sinha said such a card would bring MSMEs into a formal financing system while providing them access to working capital and capital loans at affordable rates. Stating that less than 40% of the MSMEs now borrow from the formal financial system, the panel, in its report, noted that the overall credit gap in India’s MSME sector is currently around Rs 25 trillion.
