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MCGS-MSME

Mutual Credit Guarantee Scheme for MSMEs

Launched in 2025 to help MSMEs buy plant, machinery and equipment. NCGTC guarantees 60% of the loan to the lender. At least 75% of the project cost must be equipment or machinery.

Department of Financial Services · NCGTC

Up to₹100 crore
StatusOpen

Benefits

  • Guarantee cover of 60% on loans up to ₹100 crore
  • Up to 8 years' repayment with up to 2 years' moratorium on principal (loans up to ₹50 crore)
  • No guarantee fee in the year of sanction

Eligibility

  • MSME with a valid Udyam registration
  • Equipment / machinery is at least 75% of the project cost
  • Borrower account standard (not overdue) with the lender

Documents

  • Udyam registration
  • Machinery quotations and project report
  • Audited financials, GST returns and bank statements

How to apply

  1. Apply for a machinery term loan with a participating bank or NBFC and ask for MCGS-MSME cover
  2. An upfront contribution of 5% of the loan is required when the guarantee is applied for
  3. Annual guarantee fee applies from the second year — check it in the KFS

FAQ

How is this different from CGTMSE?

CGTMSE covers micro and small enterprises up to ₹10 crore for most purposes. MCGS-MSME is for larger machinery-led projects up to ₹100 crore, including medium enterprises.

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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.