The State Bank of India (SBI) has redefined MSME financing through its SME Digital Business Loans platform. It has processed digital SME loans worth ₹74,434 crore across 225,000 accounts up to August 2025 under its SME Digital Business Loans initiative. The programme, launched in FY24, allows MSME entrepreneurs to apply online for loans up to ₹5 crore, offering a seamless and paperless credit journey.
This milestone includes 67,299 MSME Mudra loans totalling ₹3,242 crore, further demonstrating the bank’s commitment to supporting small businesses with efficient credit delivery mechanisms.
SBI’s digital lending platform has redefined how credit is assessed and sanctioned. By leveraging data from Income Tax Returns (ITR), GST filings, and bank statements, the bank has built a robust data-driven credit assessment engine. This system can issue sanction decisions in as little as 10 seconds once all required information is submitted, a major leap in turnaround time and transparency.
“MSME advances have been identified as the focal point for the bank’s growth and profitability over the next five years, and this innovative product marks a significant leap forward in digitalisation,” the bank stated.
The digital loan product focuses on cash flow-based lending, where the borrower’s financial discipline plays a central role. For loans up to ₹50 lakh, financial statements are not required; instead, the evaluation relies on transaction history and GST returns.
This approach eliminates traditional hurdles like collateral or lengthy approval procedures, making access to capital more inclusive for entrepreneurs. It also helps the bank accurately assess repayment capability using real-time data, ensuring a fairer and more efficient credit decision process.
As of March 31, 2025, SBI reported 19% year-on-year growth in the SME segment, underscoring the growing appetite for small business credit. This performance highlights the success of technology-driven lending models in strengthening the MSME ecosystem, which is vital for India’s economic growth and employment generation.
The bank reiterated that its sustained focus on MSME advances aligns with its five-year strategic plan to drive growth, profitability, and financial inclusion through digital innovation.
By digitising every step of the credit process, SBI has democratised access to business finance. The combination of automation, data integration, and user-friendly application systems has made it easier for entrepreneurs to secure timely funding.
This initiative also reduces manual errors, enhances transparency, and ensures faster disbursals, allowing MSMEs to focus more on operations and expansion rather than paperwork.
Read More: MSME Loans Cross ₹40 Trillion in FY25 as Digitisation and PSL Drive Growth!
SBI’s ₹74,434 crore digital lending initiative marks a major stride toward tech-enabled financial inclusion. It shows how data-driven lending can power MSME growth across India.
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Published on: Oct 11, 2025, 2:16 PM IST
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