MSMEs Resilient Amid Global Tensions

June 3, 2026

India’s micro, small and medium enterprises “remain resilient despite global geopolitical uncertainties” and the sector’s credit exposure rose to about Rs 46 lakh crore in April 2026. The report from credit bureau CRIF High Mark said MSMEs’ resilience is supported by strong domestic demand, policy support, and diversified credit participation. The overall credit exposure in the sector rose 12.8 per cent year on year, supported by asset quality gains, diversified geographic and sectoral participation.

However, early impact of global geopolitical uncertainties into domestic credit supply in certain sectors and borrower segment is evident through a slowdown in credit growth, with portfolio expansion and active loan growth moderating significantly compared to last year Between December 2025 and April 2026, POS growth slowed to 3.1 per cent compared to 9.7% in the prior year, while active loans declined by 3.5%.

Manufacturing and trade — which together account for more than 60 per cent of point of sale share — showed the first signs of stress, with manufacturing growth moderating to 4.3 per cent from 10.4 per cent last year. Sectors such as shipping & transport, food processing, and auto & ancillaries recorded moderate POS declines amid global uncertainties. Early-stage delinquencies in manufacturing also rose slightly from 1.6 per cent to 1.8 per cent between March-April 2026. However, these movements may also reflect cyclical factors and merit ongoing observation to gauge their persistence