SBI's AI Approves ₹1L Cr Loans: Is Your MSME Next?

SBI is now using artificial intelligence to sanction nearly ₹1 lakh crore worth of MSME loans. This means faster approvals, less paperwork, and less human bias — but also a new kind of rejection you may not see coming.

Here's what happened: SBI used AI-powered underwriting to sanction close to ₹1 lakh crore in MSME loans during FY2025-26, one of the largest deployments of AI credit decisioning by an Indian bank.. The bank is also using Large Language Models to automate cheque processing for amounts up to ₹10,000, reducing manual handling in routine banking operations.. AI underwriting at SBI evaluates data including GST filings, bank transaction history, and cash flow patterns to assess borrower creditworthiness algorithmically..

What you should do: File your GST returns on time every quarter — AI loan engines at large banks treat consistent GST compliance as a primary creditworthiness signal.. Download and review your last 12 months of bank statements before applying for any MSME loan — irregular credits, frequent overdrafts, or bounced cheques will hurt your AI score.. If your loan application is rejected by an AI system, formally ask the bank for a written reason — RBI's fair lending guidelines entitle you to a rejection explanation..

Maintain a separate current account exclusively for business transactions — AI underwriting models read account 'hygiene' and mixing personal and business cash flows signals financial risk to the algorithm.