Why is it in the news?
RBI amended Lending to MSME Sector Directions, 2026.
Increased collateral-free loan limit for Micro & Small Enterprises.
Category: Economy
Important Points:
● Collateral-free loan limit raised from ₹10 lakh to ₹20 lakh
● Applicable for loans sanctioned/renewed after 1 April 2026
● Applies to all MSE borrowers
● Covers units under PMEGP
● PMEGP launched in 2008; implemented by KVIC
● Banks may allow up to ₹25 lakh based on track record
● Voluntary gold/silver pledging not violation
● Strengthens last-mile credit delivery