·       Around 31.2 lakh individual entrepreneurs in Rajasthan have never borrowed as enterprises, with 65% having credit scores above 730

·       Nationally, micro business entrepreneurs account for ₹29.6 lakh crore in outstanding commercial credit, with individual borrowing growing at 21% CAGR

Jaipur, India, 28^th October 2026: Rajasthan's micro business entrepreneur (MBE) credit market has reached approximately ₹2.01 lakh crore in outstanding balances as of June 2026, with business-purpose borrowing by individuals growing faster than lending to micro businesses. Over the last three years, outstanding balances held by individual entrepreneurs expanded at a 20% compounded annual growth rate (CAGR), compared with 13% among micro businesses, reflecting the growing role of individual borrowing in financing entrepreneurial activity.

This expansion is also bringing attention to a sizeable opportunity in enterprise-level credit. Approximately 31.2 lakh individual entrepreneurs in Rajasthan had never borrowed as enterprises as of March 2026, even as 65% of them had CIBIL Scores above 730. These findings, from Micro Business Entrepreneurs in India: Growth, Transformation & Emerging Opportunities, a joint study by TransUnion CIBIL and the National Small Industries Corporation Limited (NSIC), highlight the potential to widen access to structured business financing among entrepreneurs who already have established individual credit profiles.

Across India, MBEs accounted for ₹29.6 lakh crore in outstanding commercial credit as of June 2026, representing nearly half of the overall commercial credit portfolio. Of this, ₹19.1 lakh crore was held by individuals borrowing for business purposes and ₹10.5 lakh crore by micro businesses. Individual borrower balances grew at a 21% CAGR over three years, compared with 12% among micro businesses, indicating that business-purpose borrowing in individual capacity is expanding faster than enterprise-level credit.

Chart 1 – Commercial Outstanding Balances

Rajasthan's Entrepreneurial Credit Growth Reflects Strong Trading and Commercial Vehicle Activity

Rajasthan's micro business credit landscape reflects the importance of trading, manufacturing and transportation-linked businesses in the state's entrepreneurial ecosystem. Trade accounts for 39% of outstanding balances among micro businesses, while manufacturing contributes 20%. Within manufacturing, food-processing credit expanding at a 17% CAGR over the last three years. LAP remains the largest financing product, accounting for 35% of overall MBE balances, while commercial vehicle loans contribute another 20%. NBFCs account for approximately 39% of individual business borrower financing, primarily through commercial vehicle lending, reflecting their role in supporting entrepreneurial activity across the state.

Ejaz Nazeer, Chief Product Officer, TransUnion CIBIL, said: “Rajasthan's entrepreneurial economy is supported by a diverse network of traders, transport operators and small manufacturers, each with different business cycles and financing requirements. For many entrepreneurs, access to timely credit can influence their ability to manage inventory, maintain operations or invest in additional capacity. As their businesses mature, there is an opportunity for lenders to move towards a more comprehensive understanding of their business activity and repayment capacity. Greater access to working-capital solutions and enterprise-level financing can help entrepreneurs build stronger businesses and participate more meaningfully in the formal credit ecosystem.”

Krishna Gopal Jaiswal, Deputy General Manager, NSIC, said: “The MSMEs engaged in manufacturing and service activities in the state of Rajasthan are largely contributing to the state’s economy and local employment. The report points to a sizeable ‘missing middle’ in the state: around 31.2 lakh entrepreneurs with healthy credit histories, most with CIBIL Scores above 730, who still borrow only in their individual capacity. Helping them move into the formal enterprise credit system is a priority for NSIC. Through raw material assistance, raw material distribution, bill discounting, bank credit facilitation and market access under the Single Point Registration Scheme and MSME Global Mart, we want these entrepreneurs to become credit-ready and grow as formal enterprises. Our partnership with TransUnion CIBIL gives this effort a strong, data-driven foundation.”

Bridging the Gap Between Individual Borrowing and Enterprise-Level Credit

A significant number of India's MBEs have established borrowing histories in their individual capacity but have yet to access credit as formal business entities. As of March 2026, approximately 3.9 crore individual business borrowers across India had never borrowed in an enterprise capacity. Among them, 54% had two or more years of business-credit experience, while 63% had CIBIL Score of above 730, indicating a substantial pool of borrowers with established credit profiles.

For lenders, this represents an opportunity, subject to their applicable credit policies, underwriting criteria and regulatory requirement, to support entrepreneurs as they progress from individual business borrowing towards enterprise-level credit. Greater access to working-capital facilities, cash credit and overdraft products could help businesses meet evolving financing requirements, while reducing their dependence on personal assets as collateral.

Chart 2 – Opportunity for Formalising Enterprise Credit Access

Rajasthan's opportunity for deeper enterprise credit access is supported by an established base of individual business borrowers. Among the 31.2 lakh entrepreneurs who had never borrowed as enterprises, 33% already possessed more than two years of business-credit experience. As of June 2026, 47% of outstanding individual business borrower balances belonged to the above prime segment¹. Portfolio performance has also strengthened, with 90+ days delinquency declining by approximately 39 basis points over three years to 1.4%. The combination of established credit histories and improving repayment performance provides a foundation for expanding access to enterprise-level financing among eligible entrepreneurs.

Secured Lending Remains Central to Micro Business Credit

Across India, lending to micro business entrepreneurs remains predominantly supported by secured and collateral-backed products. LAPs accounted for ₹10.9 lakh crore in outstanding balances as of June 2026, making it the largest product category, followed by cash credit and overdraft facilities at ₹5.6 lakh crore and commercial vehicle loans at ₹5.0 lakh crore. These financing patterns reflect the continued importance of collateral in supporting business borrowing, while also highlighting opportunities to expand cash-flow-based and working-capital-oriented lending.

The expansion in micro business credit has been accompanied by improving portfolio quality. Overall delinquency levels declined from approximately 3.0% in June 2023 to 1.9% in June 2026, reflecting stronger repayment performance amid sustained credit growth. As financing becomes more accessible, understanding the credit needs and repayment capacity of different entrepreneur segments will remain important for maintaining portfolio resilience.

Enabling the Next Phase of Micro Business Growth

As India's entrepreneurial ecosystem expands, the next phase of micro business credit growth will increasingly depend on enabling businesses to progress towards more structured enterprise financing. Wider adoption of cash-flow-based underwriting, credit guarantee mechanisms and digital financial information can help lenders assess viable businesses beyond traditional collateral-based approaches.

Strengthening the connection between individual business borrowing and enterprise-level credit can support greater formalisation, improve access to financing suited to different stages of business growth and create new opportunities for entrepreneurs across India.

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1. Enhanced CreditVision (CV) score ranges are: below prime = 300-730; prime = 731-800; above prime = 801-900.