Union Minister Jitan Ram Manjhi Announces Collateral Free Loans For Puducherry MSMEs

On Thursday, Union Minister for Micro, Small, and Medium Enterprises (MSME) Jitan Ram Manjhi conducted a comprehensive review of ongoing development schemes in Puducherry and announced new directives for commercial banks to support small-scale industries. Speaking to reporters after the review, the Minister emphasized the vital role that small businesses play in the national economy, characterizing the MSME sector as the second backbone of India’s economic growth, positioned immediately behind the agriculture sector.

During his address, Manjhi highlighted the substantial economic footprint of these enterprises, noting that MSMEs contribute an impressive 31.1% to India's Gross Domestic Product (GDP). He specifically praised the progress of the Union Territory, adding that MSME units in Puducherry are currently functioning remarkably well.

To further bolster the sector, the Minister explained that registered enterprises are receiving structured and skill-based training. Manjhi expressed strong optimism that this ongoing training initiative will enhance both the capacity and the day-to-day efficiency of the local workforce in Puducherry.

In a major policy directive aimed at easing financial constraints, Manjhi announced that the Ministry has instructed commercial banks to grant loans of up to ₹1 lakh to MSME enterprises. Under these instructions, banks are barred from demanding any collateral or security guarantees from the borrowing enterprises.

Furthermore, the Ministry has directed banks to provide these credit facilities at highly subsidized interest rates. The interest rates for these loans must be at least 5% lower than the standard interest rates typically levied on other commercial or utility loans. Manjhi stated that these financial measures are designed to protect small industries from heavy financial burdens and ensure their long-term viability.