PM Vishwakarma Scheme: PSBs disbursed loan in 1 of 4 applications till Aug

The scheme - launched in 2023 on the birthday of PM Modi to provide financial support and skill development to artisans in informal sector - has received 1.2 mn applications by PSBs till August 2025

A little over one in every four applications under the PM Vishwakarma Scheme have received loans from public sector banks (PSBs), according to government data reviewed by Business Standard.

 

The scheme — launched in 2023 on the birthday of Prime Minister Narendra Modi to provide financial support and skill development to artisans in the informal sector — has received 1.2 million applications by PSBs till August 2025.

 

Of this, PSBs have processed 1.2 million applications and loans have been sanctioned for 397,852 applicants. However, only 333,632 loans amounting 27.2 per cent of the total applications have finally been disbursed.

 

India’s largest public sector lender, State Bank of India, received over 521,618 applications, processed nearly all of them but sanctioned only 143,567 applications. It disbursed 122,659 loans or 23.4 per cent of total applications.

 

Disbursal of loans by other major PSBs, such as Punjab National Bank (38.3 per cent), Bank of Baroda (28.7 per cent) and Canara Bank (38.2 per cent) are better than SBI.

 

An email sent to the finance ministry remained unanswered till the time of going to press.

 

“The bulk of rejections are linked to applicants’ existing liabilities and past repayment behaviour. Factors such as non-performing loan history, incomplete documentation, or failure to meet eligibility criteria often trigger disqualification. Since the scheme is designed to support individuals with reasonably stable financial records, those with weak credit profiles are viewed as high risk. This significantly lowers their chances of approval,” a senior PSB official said.

 

The banker further noted that they were earlier facing some issues at the registration level as well. But now, they are hopeful to accelerate this scheme.

 

“The clear directions we have from the government in the last review meeting is that no application is meant to be closed outright at the branch. Any rejection should be escalated for review, with cases sent back for re-processing. Branch managers are expected to reach out again to applicants and exhaust all possible options before a final decision is taken,” the banker added.

 

The scheme is being jointly implemented by the Ministry of Micro, Small, and Medium Enterprises (MoMSME), the Ministry of Skill Development and Entrepreneurship (MSDE), and the Department of Financial Services (DFS) under the Ministry of Finance (MoF). 

 

The scheme was launched with a financial outlay of ₹13,000 crore for a period of five years (till FY28).

 

According to data from the PM Vishwakarma website, as on September 17, there are 27.1 million applications submitted under this scheme. Of this, only 3 million have been successfully registered after clearing the three steps process.

 

On Wednesday, while addressing a rally in Dhar, Madhya Pradesh, Modi highlighted the nationwide celebration of Vishwakarma Puja and described it as a moment to also celebrate the success of the PM Vishwakarma Yojana.

 

The PM expressed satisfaction that the Vishwakarma Yojana has supported over 3 million artisans and craftsmen in a short span. Elaborating further, he said that through this scheme, beneficiaries have received skill training, access to digital marketing, and modern tools.

 

He added that more than 600,000 Vishwakarma partners have been provided with new equipment, and loans exceeding ₹4,000 crore to support their work.

 

“PM Vishwakarma Yojana has most significantly benefited those sections of the society that were neglected for decades,” he said.