Amit Shah Urges Banks to Join Global Top 10, Boost MSME Fund

Union Home Minister Amit Shah recently urged Indian banks to set their sights higher and aim to be among the world's top 10 banks. Speaking at the Financial Express India's Best Banks Awards in Mumbai on September 25, 2025, Shah emphasized that Indian banks should not just plan for incremental growth but should scale up their ambition and operations to compete globally.

A key part of Shah’s message was the critical importance of supporting micro, small, and medium enterprises (MSMEs). He reminded bankers and the broader public that many of India’s largest business houses, including Reliance Industries, the Adani Group, and Torrent Group, started their journey as MSMEs. According to him, if the banking system in a country like India neglects MSMEs, it can halt the nation’s growth story. Banks must actively increase funding for MSMEs, which form the backbone of the economy and contribute significantly to job creation and industrial development.

Shah highlighted that the government stands as a guarantor for MSME growth and urged banks to focus their lending towards this sector. However, it is notable that MSME growth in the financial year 2024-25 slowed down to 14.1%, from over 20% in the previous year. This slowdown, coupled with concerns about credit quality in MSME loans, points to challenges that banks and policy makers need to address as they work to boost the sector.

Beyond urging banks to scale and support MSMEs, Shah painted a broader optimistic picture of India's economic position globally. Despite many countries suffering economic stagnation or slow growth of 1-2%, India has maintained steady growth rates of 7-8%. This robust performance, he said, is underpinned by consistent structural reforms, digital transformation, and financial inclusion. For instance, India now enjoys 95% 5G coverage and widespread adoption of digital payments like UPI, enabling even small rural businesses and vegetable sellers to transact digitally.

Shah further referred to the decade-long reforms led by Prime Minister Narendra Modi’s government, which have helped reduce non-performing assets substantially, cut extensive compliances, and improve the ease of doing business. India has also seen a rise in start-ups from just 26 a decade ago to nearly 1.92 lakh today, moving up from 26th to 3rd place globally in the start-up ecosystem ranking. Such achievements reflect the creation of a new economic ecosystem that supports innovation and entrepreneurship.

The minister framed this push for banking sector scale-up and MSME support within the larger national goal of making India a 'vishwaguru' (world leader) by 2047. He pointed out inclusiveness, in political, social, and financial terms, as a key pillar of India's inclusive growth story. According to Shah, India’s consistent foreign direct investment growth of 14% yearly reflects global confidence in its economic trajectory.

Shah’s call to Indian banks shows an intent to push the financial sector to be more globally competitive while ensuring grassroots economic inclusion through MSMEs. The challenge will lie in balancing rapid growth ambitions with managing risks—especially given concerns about lending quality in the MSME segment. It will require banks to innovate lending models, strengthen risk management, and collaborate closely with government support mechanisms.

In summary, Amit Shah’s message is clear: Indian banks should aim not just for incremental growth but global relevance by expanding their scale and funding critical sectors like MSMEs. Backed by government reforms and India's robust economic fundamentals, this vision has the potential to accelerate India’s rise as a global economic powerhouse, provided that the quality of credit and financial stability are carefully maintained.

With inputs from agencies

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