New Delhi, April 9 -- The government plans to seek the central bank's support for targeted relief measures to ease financial stress on small businesses hit by the West Asia conflict.

The plan involves regulatory relaxations, including on special mention account (SMA) and non-performing asset (NPA) classification timelines, effectively giving micro, small and medium enterprises (MSMEs) more time before their loans are tagged as stressed or bad, two persons aware of the matter said.

Currently, loans are classified as special mention accounts based on the number of days they remain overdue. These include SMA 0 (1 to 30 days), SMA 1 (31 to 60 days) and SMA 2 (61 to 90 days) as early warning indicators of stress. If the overdue period exceed...