New Delhi, 21 January. The Union Cabinet meeting chaired by Prime Minister Narendra Modi has approved equity assistance of Rs 5,000 crore to the Small Industries Development Bank of India (SIDBI). This amount will be provided by the Department of Financial Services (DFS) in three phases – Rs 3,000 crore in FY 2025-26 and Rs 1,000 crore each in FY 2026-27 and 2027-28.
dfs This amount will be provided in three phases by
This equity investment will strengthen SIDBI’s capital and significantly increase its ability to provide credit to Micro, Small and Medium Enterprises (MSME). It is estimated that the number of MSMEs receiving financial assistance will increase from 76.26 lakh at the end of FY 2025 to about 1.02 crore by FY 2028. This will benefit about 25.74 lakh new MSMEs and create an estimated 1.12 crore new jobs.
SIDBI Potential for growth in risk-weighted assets of
In the background, SIDBI’s risk-weighted assets are likely to increase due to increased and affordable credit facilities to MSMEs, promotion of digital and unsecured loan products and venture debt for startups. In such a situation, this capital investment will help SIDBI to maintain the capital adequacy ratio (CRAR) at a healthy level.
This decision is being considered an important step towards empowering the MSME sector, promoting employment generation and accelerating the goal of self-reliant India.
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