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CGTMSE

CGTMSE Credit Guarantee Scheme

The trust guarantees 75–90% of a bank's loan to a micro or small enterprise, so the bank can lend without collateral or a third-party guarantee. The cover limit was raised to ₹10 crore per borrower from 1 April 2025.

Credit Guarantee Fund Trust for Micro and Small Enterprises (Ministry of MSME & SIDBI)

Up to₹10 crore
StatusOpen

Benefits

  • Term loans and working capital up to ₹10 crore without collateral
  • Higher cover (up to 90%) for women-led and some special-category borrowers
  • Annual guarantee fee from about 0.37% p.a. for smaller loans, rising with loan size

Eligibility

  • New or existing micro and small enterprises in manufacturing, services or retail trade
  • Loan from a CGTMSE member lending institution (most banks, many NBFCs and SFBs)
  • Valid Udyam registration

Documents

  • Udyam registration certificate
  • KYC of promoters and the business
  • Project report or working-capital assessment
  • Bank statements, GST returns and ITRs

How to apply

  1. You don't apply to CGTMSE directly — ask your lender to cover the loan under CGTMSE
  2. The lender assesses your file and registers the guarantee
  3. Check the guarantee fee in your Key Fact Statement — it is usually passed on to you

FAQ

Can a bank still ask for collateral?

For loans covered under CGTMSE, the lender should not take collateral or a third-party guarantee for the covered facility. Ask the lender to confirm in writing.

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Sources

Last checked: 20 Oct 2026. Summary for information only. The implementing agency's guidelines and your lender's credit policy decide eligibility and terms.