Page 12 - Cgtmse

23 Annual Report 2022-23
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Fostering Advancement through

Value-Centered Schemes

Availability of bank credit without the hassles of collaterals / third party guarantees would be a major source
of support to the first generation entrepreneurs to realise their dream of setting up a unit of their own Micro
and Small Enterprise (MSE). Keeping this objective in view, Ministry of Micro, Small & Medium Enterprises
(MSME), Government of India and SIDBI launched Credit Guarantee Scheme (CGS) so as to strengthen
credit delivery system and facilitate flow of credit to the MSE sector.

The success of CGTMSE is not only reflected in the increased accessibility of credit for MSEs but also in
the positive impact on job creation, local economic development, and the overall resilience of the small
business sector in India.

CGTMSE, dedicated to empowering micro and small enterprises, operates through a comprehensive
framework comprising five impactful credit guarantee schemes designed to facilitate accessible and
collateral-free financing for the growth and development of businesses.

Credit Guarantee Scheme for
Banks (CGS-I)

The Scheme is operated through Banks/LIs (Lending
Institutions). Credit Guarantee upto `5 crore for the credit
facilities extended by MLI to MSEs without collateral
security & third party guarantee. Unsecured portion of
the Credit facilities with partial collateral security can be
covered under separate product called ‘Hybrid Security Model’. Special Benefits in terms of
discount in fee & higher coverage are available to segments such as Women entrepreneurs /
SC/ST entrepreneurs / MSEs situated in Aspirational District / ZED certified MSEs / Person with
Disability (PwD) / MSE promoted by Agniveers etc.

Credit Guarantee Scheme for
NBFCs (CGS-II)

Recognizing the vital role NBFCs play in the MSE
ecosystem, a dedicated Credit Guarantee Scheme (CGS-
II) was devised specifically for NBFCs, aiming to streamline
and facilitate convenient access to credit for the MSE
sector. The scheme was launched in January 2017.

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