IDBI Bank’s MSME Makeover: Where Innovation Meets India’s Ambition

At ET World MSME Day 2025, IDBI Bank is leading the charge in transforming MSME lending by introducing a line of digital-first, entrepreneur-focused products to drive India's 63 million small businesses. In its mission to double its MSME footprint, the bank is leveraging technology, local insights, and a "friend-first" philosophy to fuel the next generation of entrepreneurial expansion.

 

Digital Lending Innovation

The i-MSME Express, a digital underwriting platform based on GST data, has enabled real-time collateral-free lending for new-to-bank and new-to-credit MSMEs. Over 500 MSMEs have already benefited from more than ₹150 crore lending and intend to enhance loan limits to ₹2 crore.

 

Proactive Support to Distressed MSMEs:

The SAJAG asset monitoring system uses predictive analytics to detect early warning signals of financial distress and provide instant relief such as restructuring and bridge lending. For small cases up to ₹10 lakh, the action is taken instantly at the branch level, while bigger cases are handled by special rehabilitation committees.

 

Genuine Local Engagement:

MSME branch special asset officers ensure on-the-job training, and state and district government coordination facilitates the development of budding business clusters and value chains.

 

Mudra Scheme Excellence: IDBI Bank achieved 101% of the Mudra loan target for last year with a single-digit NPA ratio, a rare feat in the industry, due to data-driven lending and digital penetration.

 

Aggressive Growth Objectives:

The bank is targeting to increase its MSME loan book by 25% this year, following a 23% growth in the last year. The strategy involves doubling MSME branches to 200, increasing Credit Support Cells, and taking digital lending to ₹500 crore within 18 months.

 

Customized Solutions for Industry Clusters:

Targeted fiscal products and increased integration with official programs are being launched for nano and micro entrepreneurs. We are proud to be a true friend to Indian MSMEs. When businesses have confidence that their bank is backing them up, during the upswings and during the downswings, they can dream bigger. — Sumit Phakka, Deputy Managing 

Director, IDBI Bank 

 

Source: Economic Times,