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The Ministry of Micro, Small & Medium Enterprises (MSME), Government of India, is actively promoting the Credit Guarantee Scheme for Micro & Small Enterprises (CGTMSE) to empower first-generation entrepreneurs and foster self-employment opportunities. According to the Ministry of MSME, this initiative provides vital credit guarantee support to MSMEs for collateral-free loans, enabling Micro and Small Enterprises (MSEs) to access financial assistance without the need for traditional collateral or third-party guarantees. Under the CGTMSE, eligible businesses can secure loans of up to Rs 10 crore, with the extent of guarantee coverage ranging from 75 per cent to 90 per cent, depending on the profile and risk assessment of the borrower.This scheme applies to all Micro and Small Enterprises (MSEs).Applicants can avail of this benefit by approaching Member Lending Institutions, including banks and Non-Banking Financial Companies (NBFCs), that are partnered with the CGTMSE framework. According to the ministry, there are an estimated 26 million micro and small enterprises (MSEs) in the country providing employment to an estimated 60 million persons.Under this scheme, both the existing and the new enterprises are eligible for credit-free loans under the scheme.The scheme was formally launched on August 30, 2000 and is operational with effect from 1st January 2000. The corpus of CGTMSE is being contributed by the Government and SIDBI in the ratio of 4:1, respectively.
As of July 1, 2025, loans of Rs 10,26,145 crore have been approved under the scheme against over 1.2 crore guarantees. Maximum loan under the scheme is approved for Maharashtra of Rs 1,26,521 crore, Uttar Pradesh at number two at Rs 1,04,856 crore, followed by Gujarat with a loan approval under the scheme at Rs 85,160 crore. (ANI)
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