Industrial policy may leverage Blockchain to digitise land records for easy loans to MSMEs

The proposed industrial policy may suggest leveraging of blockchain technology to digitise land records to enable MSMEs to access easy loans against assets or properties, an official said. Use of blockchain technology to digitise land records would enhance ease of asset-based lending to micro, small and medium enterprises (MSMEs), the official said.

Property records are generally used as collateral for loans by MSME units and it requires lot of efforts to scrutinise those records. The official said that several states and municipalities are digitising land records but there is no common format or security standards. Blockchain technology can be used to digitise land records across the country as it would simplify the process of proving loans against property for MSMEs, they added. The policy may also suggest other ways to ease the process of lending to these units.

Commerce and Industry Minister Suresh Prabhu earlier this month had stated that the policy was ready and would soon be approved by the Cabinet. The commerce and industry ministry in August last year floated a draft industrial policy with an aim to create jobs for the next two decades, promote foreign technology transfer and attract US$ 100 billion foreign direct investment (FDI) annually.

The proposed policy aims at promoting emerging sectors and modernising existing industries. It will also look to reduce regulatory hurdles and encourage adoption of frontier technologies such as robotics, artificial intelligence and blockchain.

The ministry is also considering to set up industrial health clinics to deal with ailing MSMEs as part of the proposed policy. The new policy will replace the industrial policy of 1991 which was prepared against the backdrop of balance of payment crisis.