Credit Assessment Model (CAM)

Public Sector Banks (PSBs) launched a Credit Assessment Model (CAM) in 2025 to improve and streamline lending to Micro, Small and Medium Enterprises (MSMEs) by leveraging digital footprints for credit appraisal.

Strong Uptake and Sanctions
Between 1 April and 31 December 2025, PSBs sanctioned:

• Over 3.96 lakh MSME loan applications
• Loans amounting to more than ₹52,300 crore

These sanctions were made under digital credit underwriting programmes, highlighting strong adoption of technology-driven lending.

How the Credit Assessment Model Works
The CAM leverages digitally fetched and verifiable data available across the financial ecosystem to enable:

• Automated loan appraisal journeys
• Objective, data-driven decision-making for all loan applications
• Model-based credit limit assessment for both
  • Existing to Bank (ETB) borrowers
  • New to Bank (NTB) MSME borrowers

Use of Digital Footprints
The model uses multiple digital data sources, including:

• KYC authentication
• Mobile number and email verification
• GST data analysis
• Bank statement analysis through the Account Aggregator framework
• Income Tax Return (ITR) verification
• Credit Information Companies (CICs) data for credit history and due diligence
• Fraud checks and risk assessments

Benefits for MSMEs and Banks
The CAM-based approach enables faster loan processing, reduced paperwork, and greater transparency, while helping banks improve risk assessment and credit flow to MSMEs—strengthening the sector’s access to formal finance.