Budget 2025: Key Banking Sector Updates!
The Union Budget 2025 introduces several significant measures aimed at strengthening the banking sector, enhancing credit accessibility, and simplifying financial processes.
The Union Budget 2025 introduces several significant measures aimed at strengthening the banking sector, enhancing credit accessibility, and simplifying financial processes.
Grameen Credit Score for Rural Lending
Public Sector Banks will develop a ‘Grameen Credit Score’ framework to better assess the creditworthiness of Self-Help Group (SHG) members and rural borrowers. This initiative aims to improve access to formal credit and financial inclusion in underserved regions.
Expansion of India Post Payment Bank Services
The services of India Post Payment Bank (IPPB) will be deepened and expanded in rural areas to provide better banking facilities, ensuring wider financial access for rural communities.
Partial Credit Enhancement Facility for Infrastructure Bonds
The National Bank for Financing Infrastructure and Development (NaBFID) will introduce a ‘Partial Credit Enhancement Facility’ to support corporate bonds issued for infrastructure projects. This move will help improve liquidity and credit flow for large-scale infrastructure developments.
Customized Credit Cards for Micro-Enterprises
To support micro-enterprises, the government will introduce customized credit cards with a limit of Rs 5 lakh for businesses registered on the Udyam portal. In the first year, 10 lakh such cards will be issued, providing much-needed working capital to small businesses.
Enhanced Loan Limit for Kisan Credit Card
The loan limit under the Modified Interest Subvention Scheme for the Kisan Credit Card (KCC) will be increased from Rs 3 lakh to Rs 5 lakh. This will help farmers access higher credit at subsidized interest rates.
Revamping the Central KYC Registry
A revamped Central KYC Registry will be launched in 2025 with a streamlined system for periodic updates, simplifying the KYC process and reducing compliance burdens for financial institutions and customers.
Disclaimer: The article is for informational purposes only and not investment advice.
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