About this programme
CGTMSE is a credit guarantee scheme jointly established by the Ministry of MSME and SIDBI to catalyze institutional credit flow to micro and small enterprises. The scheme provides guarantee cover for collateral-free loans extended by member lending institutions, enabling MSEs to access credit without pledging assets. CGTMSE does not provide financial assistance directly but guarantees loans through registered lending partners. It is run by Ministry of MSME / CGTMSE.
A credit guarantee helps you borrow by covering part of the lender’s risk, so eligible businesses can access loans they might not get otherwise. The amount and form of support that actually apply to you depend on the programme’s rules and how your application is assessed — they are not fixed for every applicant.
It is aimed at businesses in manufacturing · services (excluding agriculture). Like most government programmes, it has its own eligibility conditions, documentation and application window, and these terms are revised from time to time. Because of that, it is worth confirming the current eligibility, amount and deadline on the official programme page before you invest time in applying.
How it works
MSEs approach a registered Member Lending Institution (MLI) which evaluates the loan application. Once the loan is sanctioned, the MLI applies for guarantee cover from CGTMSE. CGTMSE approves the application and issues guarantee cover to the MLI upon receipt of the applicable annual guarantee fee. The guarantee extends to term loans, working capital facilities, and non-fund-based facilities. Guarantee extent is 80% for micro enterprises with loans up to ₹5 lakh, MSEs operated/owned by women, and loans in North-East Region.
Who can apply
Micro and Small Enterprises (MSEs) engaged in manufacturing or service activities (excluding agriculture). Startups must obtain Udyam Registration Number and, for loans above ₹5 lakh, must have IT-PAN. Existing borrowers are eligible if their credit was not restructured or in SMA2 status within the preceding year.
How to apply
- Obtain Udyam Registration Number from the MSME portal
- Prepare business plan, financial statements, and loan application
- Approach a registered CGTMSE Member Lending Institution
- MLI evaluates and sanctions the loan
- MLI applies for guarantee cover from CGTMSE
- CGTMSE issues guarantee cover upon fee receipt
Documents you’ll typically need
- Udyam Registration Certificate
- IT-PAN (for loans above ₹5 lakh)
- Identity and address proof
- Business registration documents
- Financial statements (last 2-3 years)
- Collateral/security documents (if applicable for hybrid products)
The exact checklist depends on the programme and your specifics.
Frequently asked
Does CGTMSE provide loans directly?
No. CGTMSE does not provide financial assistance directly. It only guarantees collateral-free loans extended by registered Member Lending Institutions.
What is the maximum loan amount CGTMSE can guarantee?
CGTMSE provides credit guarantee cover up to ₹10 crore per eligible borrower as of April 2025 (increased from the previous ₹5 crore limit).
What is the guarantee extent under CGTMSE?
The extent of guarantee is typically 80% for micro enterprises with loans up to ₹5 lakh, for MSEs operated or owned by women, and for loans in the North-East Region. Other loans are covered at different percentages as per scheme guidelines.
Reviewed July 2026. Government programmes change — confirm current eligibility, amounts and deadlines on the official programme page before you apply. CapEasy is a private consultancy and is not affiliated with any government authority.