How to Apply for the Credit Guarantee Scheme for Startups (CGSS)
Under CGSS your lender, not your startup, applies to NCGTC for the guarantee. This guide explains eligibility, the cover limits, and how a DPIIT-recognised founder actually gets a CGSS-backed loan.
The Credit Guarantee Scheme for Startups (CGSS) helps DPIIT-recognised startups borrow without pledging collateral. The government, through the National Credit Guarantee Trustee Company (NCGTC), guarantees part of the loan, which makes lenders more willing to lend. There's one thing most founders miss: you don't apply to NCGTC yourself. Your lender does. Your job is to get a loan from a lender that is registered under CGSS. This guide explains how that works, who qualifies, the official cover limits and the documents you'll need.
This guide is based on the official guidelines as of October 2026; always check the portal for the latest rules.
You can see the scheme summary on our CGSS listing.
What CGSS is
According to the PIB release of 9 May 2025, the government notified CGSS on 6 October 2022. It guarantees credit given to startups by scheduled commercial banks, All India Financial Institutions, NBFCs and SEBI-registered Alternative Investment Funds (AIFs). The goal is to make collateral-free debt available to startups as working capital, term loans and venture debt.
The scheme is run by the Department for Promotion of Industry and Internal Trade (DPIIT) and operated by NCGTC. The current rules are in the CGSS Gazette notification S.O. 2046(E) of 8 May 2025, which replaced the 2022 notification.
Who applies: the lender, not you
CGSS involves three parties:
- You, the startup, borrow money.
- The Member Institution (MI) is a bank, NBFC or AIF registered with NCGTC under CGSS. It lends to you.
- NCGTC guarantees part of that loan to the MI.
According to the Startup India CGSS page, the MI assesses your proposal and then applies for cover on the NCGTC portal. The guarantee is issued automatically if the eligibility conditions are met.
So in practice, "applying for CGSS" means applying for a startup loan with a CGSS-registered lender and asking for the loan to be covered under CGSS.
Who can borrow under CGSS
According to the Startup India CGSS page, your startup must:
- Be recognised as a startup by DPIIT under its Gazette notifications as amended from time to time.
- Not be in default to any lending or investing institution.
- Not be classified as a Non-Performing Asset (NPA) under RBI guidelines.
- Be certified by the MI as eligible for guarantee cover.
If you aren't DPIIT-recognised yet, that comes first. Apply for recognition through the Startup India portal.
Extra conditions on the JanSamarth "Loan for Startups" product. If you apply through the startup loan scheme on JanSamarth, its page adds:
- Your entity must be a private limited company, LLP or registered partnership firm
- It should be no more than 10 years old from incorporation, and/or have turnover of no more than Rs 100 crore
- You should have started earning revenue and have customers, or meet the bank's own policy
- Entities formed by splitting up or reconstruction, HUFs, and startups in default or NPA status aren't eligible
What the guarantee covers
According to the PIB release of 9 May 2025 and the Startup India CGSS page, the 2025 expansion raised the ceiling from Rs 10 crore to Rs 20 crore per borrower.
Transaction-based cover (for a loan to one startup):
| Loan amount | Guarantee cover |
|---|---|
| Up to Rs 10 crore | 85% of the amount in default |
| Above Rs 10 crore | 75% of the amount in default |
The maximum is Rs 20 crore per borrower.
Umbrella-based cover (for venture debt funds registered as SEBI AIFs): cover for actual losses or up to 5% of the pooled investment, whichever is lower. The maximum is Rs 20 crore per borrower, and the cover runs for the life of the venture debt fund. AIFs can't take transaction-based cover (CGSS Gazette, 8 May 2025).
Annual guarantee fee: the lender (the Member Institution) pays an annual guarantee fee to the trust on the disbursed or outstanding amount. According to the CGSS Gazette of 8 May 2025, the rate is:
| Borrower | Annual guarantee fee |
|---|---|
| Standard rate | 2% p.a. |
| Startups from the North East region, and women entrepreneurs | 1.5% p.a. |
| Startups in the 27 Champion Sectors identified under Make in India | 1% p.a. |
The scheme's management committee can revise the fee for a specific lender based on its rating, NPA level and payout ratios. The scheme doesn't say whether lenders pass this fee on to you, so ask your lender before you sign.
What loans can be covered: venture debt, working capital, subordinated or mezzanine debt, debentures, optionally convertible debt, and other fund-based and non-fund-based facilities that are debt obligations (Startup India CGSS page).
Which lenders can offer CGSS cover
According to the Startup India CGSS page, these can register with NCGTC as MIs:
- Scheduled commercial banks and financial institutions
- RBI-registered NBFCs rated BBB or above by an RBI-accredited agency, with a net worth of at least Rs 100 crore
- SEBI-registered AIFs
Not every lender has registered. The Startup India page links to NCGTC's list of eligible lending institutions, and it names Axis Bank, Bank of Baroda and HDFC Bank as examples. Ask your lender directly whether they're a CGSS member before you apply.
How to get a CGSS-backed loan: step by step
Route 1: Apply online on JanSamarth
The Startup India CGSS page points founders to JanSamarth for online applications. The JanSamarth page describes a uniform application form and a model scheme devised by IBA for adoption across 12 public sector banks. Loans of up to Rs 20 crore per borrower are covered under CGSS transaction-based cover.
- Get your DPIIT recognition certificate and keep the mobile number linked to it handy.
- Open the "Loan for Startups" page on JanSamarth and click "Check Eligibility". The first check is your startup's date of incorporation.
- Register and log in to JanSamarth as an applicant.
- Fill in the common application form. It asks for the entity's PAN, your Udyam number, Aadhaar or PAN of up to 10 directors or partners, bank account details, and uploaded bank statements.
- Upload the mandatory documents (see the checklist below), including a CMA data sheet in the common format and a detailed project report.
- Choose a bank from the list of public sector banks shown.
- Track the response. JanSamarth says that if the bank doesn't respond within 7 days, you can send the same application to another bank on the list without filling it in again.
Route 2: Go directly to a CGSS member lender
- Shortlist banks, NBFCs or venture debt funds that are registered CGSS members. The Startup India CGSS page lists them and suggests you approach the nearest branch of a member lender and ask about its process.
- Apply for a loan or venture debt through the lender's normal process, online or at a branch.
- Tell them you want the facility covered under CGSS.
- The lender appraises your startup, decides to lend, and applies to NCGTC for the guarantee.
Either way, the lending decision is the lender's. CGSS reduces their risk, but it doesn't oblige them to lend.
What the guarantee doesn't do for you
The guarantee protects the lender, not you. According to the CGSS Gazette of 8 May 2025:
- Even if NCGTC pays the lender a claim, the lender must still try to recover the full amount from you.
- Lenders must get the right, through your loan agreement or otherwise, to list defaulting borrowers' names on the trust's website.
- The lender must keep the assets financed by the loan (the primary security) in good, enforceable condition.
Treat a CGSS-backed loan like any other loan. Borrow only what your cash flow can repay.
Documents checklist
These are the documents JanSamarth's "Loan for Startups" page lists.
Mandatory:
- DPIIT startup recognition certificate
- Incorporation documents: Memorandum and Articles of Association (private limited company or LLP), or partnership deed (partnership firm)
- Audited balance sheets for the last 3 years (for existing units)
- CMA (Credit Monitoring Arrangement) data, existing and projected
- Detailed project report covering your business plan, promoter and key management profiles, PE/VC investment details, capex, major clients, target markets and associate concerns
For the online form:
- Date of incorporation
- Mobile number linked to your DPIIT certificate
- PAN of the entity and the applicants
- Udyam registration number and its linked mobile number
- Aadhaar or PAN of directors or partners (up to 10)
- Latest bank statements
- Bank account details for verification
Optional (where applicable):
- Lease agreement for rented premises
- Power supply allocation letter
- Product or service certifications and IP details (patents, brand, logo)
- Statutory approvals such as Udyam certificate, licences, pollution control certificate and GST registration
What to expect from the lender
According to JanSamarth's startup loan page:
- No collateral is required for accounts covered under CGSS. If you offer partial collateral, the guarantee covers only the unsecured part.
- Margin: generally at least 25% for both working capital and term loans, though it varies by bank.
- Tenure: term loans are generally repaid over 3 to 7 years, extendable at the bank's discretion.
- No prepayment penalty under this scheme.
- Due diligence: expect site visits, KYC checks and requests for financial records. Respond quickly and completely.
FAQ
Can I apply to NCGTC directly for a CGSS guarantee?
No. Only registered Member Institutions apply to NCGTC. You apply for a loan with a member lender, either directly or through JanSamarth, and the lender seeks the cover.
Is CGSS a grant or a loan?
Neither, for you. It's a guarantee to your lender. You still take a loan and repay it with interest. If you're looking for grants, browse subsidies and other schemes on Startup Grants India.
Does my startup need DPIIT recognition?
Yes. Only DPIIT-recognised startups are eligible borrowers under CGSS.
What is the maximum loan covered?
Guarantee cover is capped at Rs 20 crore per borrower. Cover is 85% of the amount in default for loans up to Rs 10 crore and 75% above that.
My startup has no revenue yet. Can I still apply?
CGSS itself, as described on the Startup India page, doesn't set a revenue condition. JanSamarth's startup loan product expects revenue and customers, or the bank's own policy. Lenders decide on their own credit norms, so check with yours.
Can I get help preparing the CMA and project report?
Yes. Your CA can prepare them, or see our services. To compare other credit options, see business loans.
