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Finance Minister Nirmala Sitharaman has said that the banking community should view Micro, Small and Medium Enterprises (MSMEs) not merely as a sector of risk but as a sector brimming with opportunity. Sitharaman noted that cash flow-based lending has the transformative potential to address the working capital requirements of MSME units. She said India’s sound banking system, with cleaner balance sheets & adequate capital buffers and robust earnings, is well positioned to cater to the financing of long-term projects. She said that India’s economy, in its traditional or modern ways, depend a lot on MSMEs and ‘we need to be sensitive towards their needs’.

Besides, she said digital financial literacy must also be a priority to build public confidence in digital transactions. She stated ‘Digital financial literacy must also be a priority to build public confidence in digital transactions. In managing the banks, we should be extremely careful that governance is given a priority. By addressing both the ‘access’ and ‘quality’ aspects of financial inclusion, we can ensure that all segments of society are part of India’s journey toward Viksit Bharat’.

She added over the decade, through Jan Dhan Yojana and DBT, 54 crore Indians, including men and women, at the last mile and outside the formal banking net, have all come to enjoy the fruits of financialization. Moreover, she said the next wave of financial inclusion should see the transformation of these savers into investors of acumen, creating a largely self-reliant domestic financial system that bodes well for a resurgent Global South and India as well. That would be the ultimate success for banking, in a uniquely Indian way.