What is CGTMSE and how does it help MSEs?

CGTMSE (Credit Guarantee Fund Trust for Micro & Small Enterprises) provides a government-backed guarantee to lending institutions, enabling them to extend collateral-free loans to micro and small enterprises. This means MSEs do not need to pledge property or assets to get a business loan.

What is the maximum loan amount covered under CGTMSE?

Under the standard track, the maximum guarantee ceiling is ₹2 crore per borrower. For micro enterprises, 85% of loans up to ₹5 lakh are covered; 75% coverage applies for other MSEs; retail trade gets 50% coverage.

Who pays the guarantee fee?

The annual guarantee fee (AGF) is borne by the borrower and is paid to CGTMSE through the lending institution. The fee rate varies based on the loan amount and category of borrower.

Can existing MSEs apply, or only new businesses?

Both new and existing micro and small enterprises (manufacturing or service) are eligible, as long as the loan is from a CGTMSE-member lending institution.

Do I need collateral or a third-party guarantee?

No. The entire purpose of CGTMSE is to enable collateral-free and third-party-guarantee-free loans for MSEs. The Trust provides the guarantee cover to the bank instead.

How do I apply for a CGTMSE-backed loan?

You do not apply to CGTMSE directly. Apply for a business loan at any CGTMSE-member bank or NBFC (most major banks are members). The lending institution then registers the loan with CGTMSE to obtain guarantee cover.

CGTMSE — Credit Guarantee Fund Trust for Micro & Small Enterprises

By Ministry of MSME

Up to ₹2CrRolling Applications

Quick Answer

Collateral-free credit guarantee up to ₹2 crore for micro & small enterprises

Funding amount: Up to ₹2 Cr
Funding type: Debt
Provider: Ministry of MSME
Application deadline: Rolling
Location: Open to startups registered in India

Grant providers

Provider

Ministry of MSME

New Delhi · Delhi · India

Application Process

1
Obtain free Udyam Registration at udyamregistration.gov.in.
Obtain free Udyam Registration at udyamregistration.gov.in.
You
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How to apply

Four steps from draft to disbursement — one action each.

1
Draft your application
Answer the form inside the grant tracker — AI drafts each response using your past answers, so you're not starting from a blank page.
2
Submit on the official portal
Use the official application link and verify all details before final submission.
3
Follow up
Reach out 5–7 days after submitting to confirm receipt and ask about the review timeline.

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CGTMSE — Credit Guarantee Fund Trust for Micro & Small Enterprises

CGTMSE — Credit Guarantee Fund Trust for Micro & Small Enterprises

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