The finance ministry has directed state-run banks to integrate the JanSamarth portal with their lending management systems and speed up disbursals to address the platform's 43.2% rejection rate in FY26. According to reports from Mint, the ministry issued these directions during the Department of Financial Services' review of public sector banks, with the aim of improving conversion rates on the centralized portal. The ministry has identified incomplete documentation, incorrect information and applicants choosing not to proceed with loans after receiving in-principle approvals as the main reasons behind unsuccessful applications. In FY26, about 13.1 million loan applications were sanctioned through JanSamarth, more than three times FY25's 4 million sanctions, highlighting the platform's growing importance in facilitating government scheme loans.
The finance ministry has directed banks to implement several measures to improve JanSamarth's operational efficiency. As reported by Mint, banks have been told to regularly update their business rule engines to reduce customer drop-offs after digital approvals, ensure all authorized branches are onboarded on the portal, strengthen assisted customer journeys through Business Correspondents (BCs), publicize the platform across bank branches, websites and mobile applications, and train bank officials on the available schemes. The second person cited by Mint explained that integrating JanSamarth with banks' lending management systems would improve operational efficiency by enabling end-to-end digital lending and reducing the time taken from application to final disbursal. The ministry emphasized that "the need to systematically analyse the key reasons behind loan rejections to improve approval rates and overall customer experience cannot be overemphasized."
The government has significantly expanded JanSamarth's scope and capabilities since its launch in 2022. According to Mint, in February, the government expanded the scope of JanSmarth, integrating the Credit Guarantee for Micro Enterprises (CGTMSE) and the Emergency Credit Line Guarantee Scheme (ECLGS) 5.0. The platform currently hosts 46 government-backed credit-linked schemes, including the Pradhan Mantri Mudra Yojana (PMMY), PM SVANidhi, Prime Minister's Employment Generation Programme (PMEGP), Kisan Credit Card (KCC), Agriculture Infrastructure Fund (AIF), Deendayal Antyodaya Yojana–National Rural Livelihood Mission (DAY-NRLM), Startup Loans, Rooftop Solar Installation Financing, Fisheries Kisan Credit Card, Home Loan Scheme for EWS/LIG/MIG beneficiaries, Self Employment Scheme for Rehabilitation of Manual Scavengers (SRMS), Weaver Mudra Scheme, and the recently added ECLGS 5.0 and Micro Credit Cards for MSMEs. The platform allows applicants to check their eligibility, apply online, and get instant digital approval across multiple government loan schemes in one place.
Industry experts emphasize that addressing quality issues is crucial alongside processing time improvements. As reported by Mint, Lokanath Panda, chief operating officer of BLS E-Services Ltd, noted that "Reducing loan processing time is important, but improving application quality is equally critical. Many applications are rejected due to incomplete documents or incorrect information rather than lack of eligibility." Panda added that "By guiding applicants on documentation, verifying details at the source and creating awareness about government schemes, BCs can improve application success rates, reduce rejections and help JanSamarth reach more deserving beneficiaries, especially in rural and semi-urban India." Dharanidhar Tripathy, chief executive of Business Correspondent Resource Council, New Delhi, said the ministry's directions would help strengthen digital lending if implemented effectively, stating that "Once integrated with banks' Lending Management Systems, proposals can be processed much faster as applicant information can seamlessly synchronize with bank systems."
Union MSME Minister Jitan Ram Manjhi has issued a clear directive to banks regarding institutional credit access for micro, small and medium enterprises. According to reports from PTI, the minister visited Puducherry on July 8-9 to review the implementation of flagship schemes of the MSME Ministry. During his visit, he specifically urged banks to facilitate greater access to institutional credit for MSMEs and called upon all stakeholders to ensure effective implementation of government initiatives for the sector's growth. The minister emphasized that easier financing remains essential for business expansion, innovation and job creation, with discussions during the review meeting focused on improving awareness and greater uptake of these schemes. The minister's visit represents part of a broader initiative to ensure effective implementation of government schemes for MSME sector growth, with the minister calling for effective implementation of government initiatives aimed at strengthening the sector.
