New Delhi: The Centre has asked banks to double this year's target for rolling out Micro Enterprise Cards (ME-Cards) to ensure that all eligible micro units get faster access to working capital credit, said people familiar with the matter.
The government had initially set a goal for banks to issue one million ME-Cards this fiscal year.
A model scheme for micro credit cards has already been finalised. Banks are currently in the process of making assessments of eligible borrowers for extending the facility, the people said.
Announced in the FY26 budget, the ME-Card scheme is a customised credit card aimed at providing easy access to working capital credit for micro, small, and medium enterprises (MSMEs) registered on the Udyam portal. Each ME-Card has a credit limit of ₹5 lakh. The government had envisaged that the scheme will result in additional credit disbursement of ₹25,000-30,000 crore to the MSME segment.
A senior bank executive said that after instructions from the government to fast-track the process, it was decided to have common features and eligibility criteria across the board. "We are also working on a common application form for MSME loans to bring uniformity," the executive said, adding that with proper assessment models in place, the government wants banks to step up the target and reach at least 20 million customers.
The credit card facility will be provided on a simpler assessment model based on enterprise revenues captured through digital processes such as uploading of UPI and bank statements, as well as the Account Aggregator (AA) framework. The entire process from approval to loan disbursal will be done digitally, said the executive cited above.
The government had earlier stated that ME cards would allow easy and faster credit access to Udyam-registered MSMEs without the need to submit detailed financial statements and any collateral. "This will enable smaller micro enterprises with quick and easy access to funds, and for specific purposes of working capital expenses, will enable them to track their spending and have better credit discipline," it had said.
The ME-Card scheme will be a revolving account facility valid for up to one year and renewable upon satisfactory performance of the firm. No restriction would be imposed on availing the scheme's benefits even if a borrower has already utilised a credit facility through another guarantee scheme, subject to satisfying other eligibility criteria.
The government had initially set a goal for banks to issue one million ME-Cards this fiscal year.
A model scheme for micro credit cards has already been finalised. Banks are currently in the process of making assessments of eligible borrowers for extending the facility, the people said.
Announced in the FY26 budget, the ME-Card scheme is a customised credit card aimed at providing easy access to working capital credit for micro, small, and medium enterprises (MSMEs) registered on the Udyam portal. Each ME-Card has a credit limit of ₹5 lakh. The government had envisaged that the scheme will result in additional credit disbursement of ₹25,000-30,000 crore to the MSME segment.
A senior bank executive said that after instructions from the government to fast-track the process, it was decided to have common features and eligibility criteria across the board. "We are also working on a common application form for MSME loans to bring uniformity," the executive said, adding that with proper assessment models in place, the government wants banks to step up the target and reach at least 20 million customers.
The credit card facility will be provided on a simpler assessment model based on enterprise revenues captured through digital processes such as uploading of UPI and bank statements, as well as the Account Aggregator (AA) framework. The entire process from approval to loan disbursal will be done digitally, said the executive cited above.
The government had earlier stated that ME cards would allow easy and faster credit access to Udyam-registered MSMEs without the need to submit detailed financial statements and any collateral. "This will enable smaller micro enterprises with quick and easy access to funds, and for specific purposes of working capital expenses, will enable them to track their spending and have better credit discipline," it had said.
The ME-Card scheme will be a revolving account facility valid for up to one year and renewable upon satisfactory performance of the firm. No restriction would be imposed on availing the scheme's benefits even if a borrower has already utilised a credit facility through another guarantee scheme, subject to satisfying other eligibility criteria.
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