The central government plans to modify non-banking finance companies (NBFCs) rules to offer cheaper loans to micro, small, and medium enterprises (MSME). This includes raising deposit acceptance limits, introducing deposit insurance, and providing a dedicated liquidity window for NBFCs to reduce their funding costs. Next to agriculture, the MSME sector is the backbone of the Indian economy, with about 30% share in its GDP, 45% of manufacturing output and 48% of exports, while providing 111 million people with employment. Both agriculture and MSME sectors are facing huge credit gaps. About 39% of 63.4 million MSMEs have not yet accessed loans through any formal channel. Hence, there is an urgent need to expand formal but affordable credit facilities through NBFCs if India has to become the world’s third-largest economy by 2030, the officials told HT requesting anonymity.