New Delhi, May 5 -- Bank loans under the Prime Minister's Employment Generation Programme (PMEGP) fell by half to Rs.6,148 crore in 2025-26 from Rs.12,315 crore a year earlier, marking the third consecutive decline, according to data from the micro, small and medium enterprises (MSME) ministry and its PMEGP portal.

The lower disbursements coincide with FY26 recording the lowest number of loan applications in a decade, signalling weakening momentum in credit support for small enterprises and job creation under the scheme.

The trend raises questions about the creditworthiness of MSMEs and banks' risk perception of small business loans amid external uncertainties, even as the Centre has increased the budgetary allocation for subsidized loa...