Policy Update
Shruti Sethi
Background
Youth unemployment and underemployment remain persistent concerns in India’s labour market despite recent improvements. The Periodic Labour Force Survey (PLFS) Annual Report 2025 reports that India’s youth (15-29 years) unemployment rate declined to 9.9% from 10.3% in 2024. However, significant disparities persist across states, educational levels and rural–urban areas, prompting governments to complement wage-employment strategies with self-employment and enterprise promotion.
In West Bengal, this approach builds on the state’s large MSME base, comprising nearly 90 lakh enterprises that employ around 1.35 crore people (Press Trust of India, 2024). Recognising the sector’s role in employment generation, the State Government introduced the West Bengal Bhabishyat Credit Card Scheme (WBBCCS) in the 2023–24 Budget to expand access to institutional credit for aspiring young entrepreneurs. The 2024–25 Budget further positioned the scheme as a key instrument for sustaining MSME-led growth.
WBBCCS also subsumed the earlier Karmasathi Prakalpa with effect from 1 April 2023 and was notified as a five-year mission running until March 2028. Over the three years since, the scheme has evolved from a straightforward credit-access programme into a more comprehensive subsidised-credit instrument, though its reach remains well below its original target and its public reporting does not yet permit a robust assessment of enterprise-level outcomes.
Functioning
Design at Launch (2023–24)
The Bhabishyat Credit Card Scheme was introduced in the West Bengal Budget 2023–24 with the objective of promoting youth entrepreneurship by improving access to institutional credit for micro-enterprises. Eligibility is restricted to Indian nationals who have resided in West Bengal for the preceding ten years, with only one applicant per family (defined as self and spouse) permitted. The scheme’s own notification sets no income ceiling for applicant families. The founding notification’s general eligibility criterion specifies an age band of 18 – 55 years for eligible individuals including named categories such as motor transport workers and building/construction workers.
Its design combined three key financial support mechanisms:
(i) bank-originated credit of up to ₹5 lakh,
(ii) a state-funded margin money contribution of 10% of the project cost, subject to a maximum of ₹25,000, and
(iii) a layered guarantee coverage of up to 85% from the Credit Guarantee Trust Fund for Micro and Small Enterprises (CGTMSE), topped up by a further 15% from the State Government, together covering the credit facility up to 100% (Government of West Bengal, MSME & Textiles Department, 2023) to reduce lending risk for banks and encourage credit flow to first-generation entrepreneurs.
Eligible lending institutions include all Scheduled Public Sector Banks, Private Sector Banks, Regional Rural Banks, Small Finance Banks, Cooperative Banks and other prescribed institutions. Eligible activities span manufacturing, services and trading/business, as well as farm-sector enterprises such as dairy, poultry, fisheries and piggery, provided they qualify as an enterprise under the MSMED (Micro, Small and Medium Enterprises Development) Act, 2006.
Both new and existing units may apply for term loans, working capital or composite loans, though a new unit is eligible for a second round of capital support (for machinery, tools, or expansion) only after two years of implementation. Central and State Government employees and their families, and existing defaulters with any bank or financial institution, are explicitly excluded from the scheme.
An outlay of ₹350 crore was earmarked for the year, targeting 2 lakh youth. The founding notification also specifies that the subsidy is a one-time assistance per project, and that banks must refund any unspent or unutilised subsidy within six months of receipt, a design feature aimed at limiting idle funds sitting in beneficiary accounts.
Strengthening the Mechanism (2024–25)
The 2024–25 Budget Statement introduced the Bhabishyat Credit Card Interest Subvention Scheme, extending concessional-rate benefits to eligible borrowers, including those already sanctioned under the original scheme.
The revised framework transformed the scheme into a collateral-free, 100% government-guaranteed credit programme, with beneficiaries receiving loans at a concessional interest rate of 4% per annum. The State Government committed to bearing the difference between the concessional rate and the prevailing lending rate through an interest subvention mechanism, and this benefit was also extended to loans that had already been sanctioned under the scheme.
To support this enhancement, the government earmarked ₹250 crore for the interest subvention component and projected that the scheme would benefit nearly 10 lakh young entrepreneurs over the coming years. No major structural modifications were introduced in the 2025–26 and 2026–27 Budgets; instead, these budgets focused on reporting the scheme’s cumulative progress under the framework established in 2024.
How the Two Subsidy Instruments Work Together
WBBCCS operates through two complementary subsidy streams: a one-time margin-money contribution (up to ₹25,000) to reduce upfront project costs and a recurring interest subvention that lowers the borrowing rate to 4% throughout the loan period. Together, they ease both enterprise establishment and loan repayment.
Impact
The Budget Statements report cumulative reach in each year following launch, allowing a year-on-year read of the scheme’s on-the-ground footprint. By the 2024–25 Budget Statement, nearly 20,000 youth had received financial assistance amounting to ₹426 crore. The 2025–26 Budget Statement recorded 32,389 sanctioned cases as of December 2024, with a combined project cost of ₹747 crore and state subsidy disbursement of ₹60 crore. By the 2026–27 Budget Statement, loans had been sanctioned to more than 50,000 entrepreneurs cumulatively, with subsidy flowing through two channels: approximately ₹22 crore in project (margin-money) subsidy to 10,149 beneficiary accounts, and ₹17.30 crore in interest subsidy to 39,326 beneficiary accounts.
Table 1: Key Provisions and Reported Cumulative Progress (2023-26)
| Budget Year | Key Provision(s) | Reported Cumulative Progress |
| 2023-24 | Loans up to ₹5L; margin-money subsidy up to 10% of project cost (cap ₹25,000); 15% guarantee cover; ₹350 cr earmarked | Scheme newly launched |
| 2024-25 | Interest Subvention Scheme introduced — flat 4% rate, collateral-free, 100% guaranteed, applied retroactively; ₹250 cr/yr earmarked; target of 10 lakh beneficiaries | ~20,000 youth assisted; ₹426 cr disbursed |
| 2025-26 | No new design changes; progress reporting only | 32,389 cases sanctioned (till December 2024); project cost ₹747 cr; subsidy ₹60 cr |
| 2026-27 | No new design changes; progress reporting only | 50,000+ entrepreneurs sanctioned; ₹22 cr project subsidy to 10,149 accounts; ₹17.30 cr interest subsidy to 39,326 accounts |
Source: Author’s compilation based on West Bengal Budget Statements (2023-24 to 2026-27)
Figure 1: WBBCCS: Cumulative Applications Sanctioned and Disbursed (Dec 2024–Aug 2026)
Source: West Bengal Budget Statements 2024–25 and 2025–26; Millennium Post (28 April 2025); EODB Dashboard (accessed 5 August 2026)
Figure 2: WBBCCS — Cumulative Loan Value Disbursed (Feb 2024–Aug 2026)
Source: West Bengal Budget Statements 2024–25 ; Millennium Post (28 April 2025); EODB Dashboard (accessed 5 August 2026)
Read together, the trajectory shows steady, compounding growth in reach each year with sanctions roughly doubling between the 2025 and 2026 reporting points, and a shift in composition, with the interest subsidy channel now reaching nearly four times as many accounts as the project subsidy channel. This is consistent with the retroactive extension of the subvention to earlier cohorts, meaning a growing share of the scheme’s measured impact is now being delivered through the 2024 addition rather than the original 2023 design.
As per the Ease of Doing Business (EODB) Dashboard, as of 5 August 2026, the Bhabishyat Credit Card Scheme had received 2,50,083 applications, of which 53,750 had been sanctioned and 41,134 had been disbursed. The scheme had facilitated the disbursement of loans amounting to ₹986.03 crore, indicating steady progress in extending financial assistance to aspiring entrepreneurs across the state.
Against the August 2026 disbursed figure, the average loan value works out to roughly ₹2.4 lakh per case (₹986.03 crore ÷ 41,134 disbursed cases), well below the ₹5 lakh ceiling, suggesting most funded projects are smaller-ticket than the scheme’s maximum design would allow.
Performance
The assessment below draws entirely on programme outputs i.e., applications received, sanctions issued, and loans disbursed, since this is what the Budget Statements and EODB dashboard report. It says nothing about programme outcomes, such as enterprise survival, employment generated, loan repayment performance or gains in beneficiary turnover and income, none of which are published for WBBCCS.
Target Versus Delivery
The scheme’s stated ambition was substantial: 2 lakh youth per year, implying roughly 10 lakh beneficiaries over five years, a figure the 2024–25 Budget Statement made explicit. Against this, cumulative sanctions had reached only 50,000-plus entrepreneurs by the 2026–27 Budget Statement, three years after launch. Even allowing for a scheme’s typical ramp-up period, delivery to date represents roughly 5% of the original five-year target and about a quarter of even a single year’s annual target.
Reconciling the Beneficiary Count
The 2026–27 figures report project subsidy disbursed to 10,149 accounts and interest subsidy disbursed to 39,326 accounts which together not summing cleanly to the reported 50,000-plus sanctioned entrepreneurs, nor to each other. This most plausibly reflects that the two figures measure different things: project (margin-money) subsidy disbursement typically occurs after a lock-in or verification period, while interest subsidy accrues incrementally against outstanding loans and was extended retroactively to earlier cohorts. The Budget Statements do not provide a single reconciled beneficiary count, which limits precise assessment of unique reach.
Application Funnel
The scheme’s official EODB dashboard (as of 5 August 2026) reported 2,50,083 applications received against 53,750 sanctioned and 41,134 disbursed cumulatively since 1 April 2023. This yields two conversion rates worth stating plainly:
- Application-to-sanction rate: Only about 21.5% of applications received have been sanctioned (53,750 of 2,50,083), meaning roughly four in five applicants do not clear the sanction stage.
- Sanction-to-disbursement rate: Of sanctioned applications, about 76.5% have gone on to disbursement (41,134 of 53,750), a secondary but smaller drop-off between sanction and actual disbursal.
Overall, only about 16.4% of all applications have resulted in a disbursed loan. This suggests that the shortfall against the original target stems less from weak demand than from attrition during the sanction process. The scheme’s founding notification prescribes a multi-tier screening mechanism in which applications are vetted by Block- and Sub-divisional-level committees before being forwarded to banks, while incomplete or non-conforming applications are rejected by the District Industries Centre. This screening process likely explains part of the sanction-stage attrition, alongside possible bank-level risk aversion. However, published data do not distinguish between DIC-level rejections and bank-level declines, limiting a more precise assessment.
The scheme’s notification also sets a service standard for this screening stage: complete, screened applications are to be sponsored to banks within seven days of screening completion.
Financial Utilisation
Utilisation of earmarked outlays cannot be fully assessed from the Budget Statements alone, since actual expenditure figures against the ₹350 crore (2023) and ₹250 crore annual (2024 onward) allocations are not separately disclosed. The disbursement figures reported (₹426 crore cumulative by 2024; ₹60 crore subsidy by December 2024; ₹22 crore plus ₹17.30 crore by 2026) suggest disbursement has lagged sanctioned outlay, though a firmer conclusion would require year-wise actual-versus-budgeted expenditure data.
Emerging Issues
- Enterprise-level outcomes: The Budget Statements report sanctions and disbursement but not sectoral distribution of enterprises funded, survival or repayment rates, or district-wise spread. These are all necessary for a fuller performance assessment.
- Gender disaggregation: No gender-disaggregated data is reported for WBBCCS in the Budget Statements reviewed, despite West Bengal’s MSME sector having a comparatively high share of women-owned units, a notable omission given the state’s own stated priorities elsewhere in welfare policy.
- Existence of a steep sanction-stage bottleneck: EODB dashboard data shows a steep sanction-stage drop-off with only about 21.5% of applications received are sanctioned and a further 24% of sanctioned cases have not yet been disbursed. The scheme’s own notification documents a formal DIC-level screening step that rejects incomplete applications, which plausibly explains part of this, but the published data does not separate screening-stage rejections from bank-level declines, so the relative weight of each cause remains unclear.
- Unreconciled reporting: Project and interest subsidy accounts do not sum to the headline sanctioned-entrepreneur figure and no single reconciled beneficiary count is published across Budget years.
Way Forward
- Unique beneficiary-based reporting: Assign each beneficiary a unique tracking ID at the point of sanction, and report a single de-duplicated beneficiary count each Budget Statement, reconciling the margin-money and interest-subsidy channels against each other, rather than publishing them as separate, non-summing figures as at present, to allow clean year-on-year tracking of new versus cumulative sanctions.
- Disaggregated data: Publish district-wise, sector-wise (manufacturing/services/trading/farm), and gender-disaggregated breakdowns of sanctioned and disbursed cases on a fixed quarterly cadence, at the same level of granularity the state’s Udyam registration data already provides.
- Application-level transparency: Report the number of applications received alongside sanctions, to distinguish demand-side and supply-side constraints and target awareness or bank-facilitation efforts accordingly.
- Diagnosis of the sanction bottleneck: Publish a stage-wise applicant funnel with data of applications received, DIC-screened, screened-out/rejected (with reason category), bank-sanctioned, and disbursed as a standing dashboard field, so the current single application-to-sanction ratio can be decomposed into its actual bottleneck stages rather than left as one unexplained gap.
- Recalibration of targets: Given the gap between the original 10-lakh, five-year ambition and current delivery, a revised, realistic multi-year target, grounded in observed sanction rates, would allow more meaningful performance tracking than the original headline figure.
- Outcome evaluation: An independent or third-party evaluation examining enterprise survival, repayment performance and employment generated per sanctioned loan would substantially strengthen the evidence base beyond what Budget Statements alone can offer.
Conclusion
The Bhabishyat Credit Card Scheme demonstrates the State Government’s willingness to refine its flagship youth entrepreneurship programme, particularly through the introduction of an interest subvention that made borrowing more affordable. However, despite these design improvements, progress remains well below the scheme’s original five-year target of 10 lakh beneficiaries. Moreover, the absence of reconciled beneficiary counts and disaggregated outcome data limits a comprehensive assessment of its performance. Greater transparency in reporting and independent outcome evaluation would strengthen future monitoring and help determine whether the scheme’s expanded support is translating into broader impact.
References
Government of West Bengal. (2023, February). Budget speech 2023–24. Finance Department. https://www.cbgaindia.org/wp-content/uploads/2023/02/Budget-Speech-3.pdf
Government of West Bengal. (2024, February). Budget speech 2024–25. Finance Department.
https://finance.wb.gov.in/writereaddata/Budget_Speech/2024_English.pdf
Government of West Bengal. (2025, February). Budget speech 2025–26. Finance Department.
https://finance.wb.gov.in/writereaddata/Budget_Speech/2025_English.pdf
Government of West Bengal. (2026, February). Budget speech 2026–27. Finance Department.
https://finance.wb.gov.in/writereaddata/Budget_Speech/2026-2027_English_I.pdf
Government of West Bengal, MSME & Textiles Department. (2023, March 29). West Bengal Bhabishyat Credit Card Scheme (WBBCCS): Founding notification, Memo No. 1499-MSMET. Reproduced at WBXPress. https://wbxpress.com/west-bengal-bhabishyat-credit-card-scheme-wbbccs/
Government of West Bengal, MSME & Textiles Department. (n.d.). West Bengal Bhabishyat Credit Card Scheme (WBBCCS): Scheme details and EODB Dashboard [Data set, accessed 5 August 2026]. https://bccs.wb.gov.in/scheme
Millennium Post. (2025, April 28). Bhabishyat Credit Card Scheme: Over 40K applications get sanction
Press Information Bureau. (2026, March 27). Periodic Labour Force Survey (PLFS) Annual Report, 2025 [January, 2025 – December, 2025]. Ministry of Statistics & Programme Implementation. Release ID: 2246009
https://www.pib.gov.in/PressReleasePage.aspx?PRID=2246009&lang=1®=3
Press Trust of India. (2024, June 27). West Bengal sets target of bank loans worth Rs 1.53 lakh crore for MSMEs in FY’25
About The Contributor
Shruti Sethi is a Research & Editorial Intern at IMPRI. She holds a bachelor’s degree in Economics from St. Xavier’s University, Kolkata. Her research interests include Gender & Labour Economics.
Acknowledgement
The author extends her sincere gratitude to the IMPRI team for their expert guidance and constructive feedback throughout the process.
Reviewed by Nayanshi Jain and Sairaj Patil.
Disclaimer
All views expressed in the article belong solely to the author and not necessarily to the organization.
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