Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
Government of India
Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
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CGTMSE provides credit guarantee support to lending institutions for loans extended to micro and small enterprises. This enables collateral-free credit to MSMEs, making it easier for entrepreneurs to access finance without traditional security requirements.
Key Features
Collateral-Free Credit
Provides guarantee cover enabling banks to lend without collateral/third-party guarantees
Coverage up to ₹5 Crore
Credit facilities up to ₹5 crore are eligible for guarantee cover
Both Fund and Non-Fund Based
Covers term loans and/or working capital facilities
Risk Sharing
Trust shares credit risk with lending institutions, encouraging MSME lending
Financial Assistance
| Component | Assistance | Details |
|---|---|---|
| Guarantee Coverage | Up to 85% of sanctioned amount | For ₹10 lakh loan, guarantee coverage up to ₹8.5 lakh |
| Maximum Credit | Up to ₹5 crore | Suitable for both micro and small enterprises |
| Service Fee | Nominal annual service fee | Paid by lending institution, not borrower |
| Claim Settlement | Quick claim processing for defaults | Protects lending institutions from credit risk |
Eligibility Criteria
Who Can Apply
Eligible Candidates
- 1Micro and small enterprises
- 2New and existing enterprises
- 3Manufacturing and service sector units
- 4Credit facility up to ₹5 crore
Who Cannot Apply
Ineligible Candidates
- Medium and large enterprises
- Credit facilities above ₹5 crore
- Enterprises with existing default
- Activities not covered under MSME definition
Documents Required
MSME/Udyam Registration
Mandatory
Project report/business plan
Mandatory
Identity and address proof
Mandatory
Financial statements
Mandatory
Bank statements
Mandatory
Business registration documents
Mandatory
How to Apply
Bank Branch
- 1Apply for loan at any lending institution
- 2Bank evaluates your application
- 3If eligible, bank applies for CGTMSE guarantee
- 4CGTMSE approves guarantee cover
- 5Loan is sanctioned without collateral requirement
- 6Borrower repays as per loan agreement