Credit Guarantee Fund Trust for Micro and Small Enterprises

Key Benefits

• Collateral-free and third-party-guarantee-free term loans and working capital for micro and small enterprises.
• Guarantee cover on credit of up to ₹10 crore per borrower for guarantees approved on or after 1 April 2025 (the limit was ₹5 crore before).
• Annual guarantee fee from 0.37% a year for loans up to ₹10 lakh, rising to 1.20% for loans between ₹8 crore and ₹10 crore. The lender pays it and usually passes it on.
• Several State policies reimburse the fee — for example Punjab’s 2026 policy repays 100% of it, up to ₹3 lakh a year for seven years.

Who Can Apply

• New and existing micro and small enterprises, including service enterprises and retail trade, borrowing from a CGTMSE member lending institution.
• The loan must be sanctioned without collateral security or a third-party guarantee.

Eligible Business Types

MSME Category Applicability

Eligible Industries

How to Apply

1. There is no separate application: ask your bank to cover the loan under CGTMSE when it sanctions it.
2. The bank registers the guarantee on the CGTMSE portal and pays the annual guarantee fee.

Apply at: CGTMSE

Required Documents

• Udyam Registration
• GSTIN
• Business Plan/DPR
• Bank Statements
• ITR
• KYC Documents

Stacking Compatibility

This scheme can be combined with the following for higher total benefits:

Common Rejection Reasons

• Low CIBIL score
• Inadequate project viability
• Existing default

Subsidy Setu's DPR preparation process addresses all common rejection points before filing.

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