CGTMSE the credit guarantee fund scheme for micro and small enterprises was launched by the government of India to ensure there is collateral-free credit to the micro and small enterprise sector. This scheme is applicable to both existing and new enterprises. the ministry of micro, small and medium enterprises, government of India, and small industries development bank of India (SIDBI) in collaboration has established a trust called credit guarantee fund trust for micro and small enterprises (CGTMSE) to implement the credit guarantee fund scheme for micro and small enterprises. credit can be availed without any security/collateral if an msme is eligible under the CGTMSE scheme.

CGTMSE Scheme Offered.

  • Get collateral-free loans up to Rs.5 crore under the CGTMSE scheme.
  • Cash credit for meeting the working capital requirement.
  • Term loan for purchase of commercial assets and business expansion needs.
  • CGTMSE Scheme Eligibility

  • Manufacturing units.
  • Retail trade.
  • Educational institutions.
  • Self-help groups.
  • Training institutions.
  • Selected NBFCs.
  • CGTMSE Scheme Charges

  • 0.37% for credit of up to Rs. 10 lakhs
  • 0.55% for credit that is above Rs. 10 lakhs but up to Rs. 50 lakhs
  • 0.60% for credit that is above Rs. 50 lakhs but up to Rs. 1 crore
  • 1.20% for credit that is above Rs. 1 crore but up to Rs. 2 crores
  • 1.35% for credit that is above Rs. 2 crores but up to Rs. 5 crores
  • Benefits of CGTMSE Scheme

  • Ceiling for guarantee coverage raised from Rs. 2 Cr to Rs. 5 crs.
  • Guarantee fee reduced to diminish the overall cost of borrowings to MSEs.
  • Micro finance institutions as member lending institutions are now eligible.
  • Concessions related to fees and increased coverage to SC/STs.
  • Reduced guarantee fee by 10% and coverage extent increased to 85% to women, ZED certified units and units in aspirational districts.
  • Annual guarantee fee structure revised and fee reduced to as low as 0.37%.
  • The scheme of CGTMSEs is a major contributor to the Indian economy & contributes almost 10% to the India’s GDP. this is quite a participation to boost the economical graph. this is as good as generating a dozen of employment to more than 7 crore people.
  • The best part is that CGTMSE offers benefits for all new & old MSMEs. the most significant being that you’re covered for the credit facility obtained, even when you didn’t have less or zero experience in starting out a business. it’s important to note that the credit cover is optional, the MSME ministry has attached due importance to the scheme and tracks its progress on a longer span.
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