- Objective and Overview
- Launched in 2015, PMMY aims to extend affordable credit to micro and small enterprises (MSMEs), bringing them into the formal financial system. It offers loans under three categories: Shishu (up to ₹50,000), Kishore (₹50,001–₹5 lakh), and Tarun (₹5 lakh–₹20 lakh).
- Achievements
- Provided credit support of ₹18.39 lakh crore to over 35 crore micro and small entrepreneur accounts.
- Women entrepreneurs account for 71.4% of loan accounts (FY 2022), with significant support to SC/ST/OBC borrowers.
- Promoted financial inclusion and small businesses, with 80% of loans under the Shishu category.
- Challenges Identified
- Rising NPAs: Public sector banks face the highest NPA rates (22.6%), particularly in Kishore accounts.
- Regional disparities: Northeast region records the lowest loan disbursement and declining trends post-FY 2018.
- Implementation gaps: Issues with documentation, connectivity in remote areas, and limited employee capacity hinder progress.
- Institutional Issues
- Complex processes under the Credit Guarantee Fund for Micro Units (CGFMU) and lack of centralized, digitized platforms for data management and redressal.
- Poor monitoring, absence of standardized performance evaluation, and lack of credit penetration to weaker sections.
- Way Forward
- Promote awareness through traditional and digital media.
- Digitize the lending process, create real-time beneficiary data portals, and integrate with other schemes like “59-Minute Loans.”
- Incentivize well-performing institutions and adopt group-based lending systems to reduce NPAs and improve outreach.
