National Credit Guarantee Trustee Company (NCGTC)

Overview

The National Credit Guarantee Trustee Company Limited (NCGTC) is a wholly government-owned company set up by the Department of Financial Services, Ministry of Finance, Government of India. Incorporated under the Companies Act 1956 on 28 March 2014, NCGTC acts as a common trustee company to manage and operate multiple credit guarantee funds. Its core purpose is to share the lending risk of banks, NBFCs and other financial institutions, thereby enabling collateral-free, accessible finance for underserved borrowers — including startups, micro and small enterprises, students, skill-development trainees and exporters.

What NCGTC Does

Credit guarantee programmes work by absorbing a portion of a lender's default risk. By standing behind eligible loans, NCGTC encourages financial institutions to lend to borrowers who would otherwise struggle to provide collateral or a credit history. NCGTC currently administers a portfolio of dedicated credit guarantee trusts, including:

• Credit Guarantee Scheme for Startups (CGSS) — provides guarantee cover for loans extended to DPIIT-recognised startups, enabling collateral-free debt funding.
• Credit Guarantee Fund for Micro Units (CGFMU) — backs micro loans under the Pradhan Mantri MUDRA Yojana.
• Credit Guarantee Fund for Stand-Up India (CGFSI) — supports loans to SC/ST and women entrepreneurs.
• Credit Guarantee Fund Scheme for Education Loans (CGFEL) and Skill Development (CGFSD).
• Emergency Credit Line Guarantee Scheme (ECLGS) — a flagship COVID-19 relief programme.
• Credit Guarantee Scheme for MFIs (CGSMFI), Factoring (CGFF), and COVID-affected sector schemes (LGSCAS, LGSCATSS).

Relevance to Startups

For the startup ecosystem, the Credit Guarantee Scheme for Startups (CGSS) is NCGTC's most significant offering. Launched under the Startup India initiative, CGSS provides credit guarantees on loans extended by member institutions (scheduled banks, NBFCs and SEBI-registered Alternative Investment Funds) to eligible DPIIT-recognised startups. This allows early-stage and growth-stage ventures to raise working capital, venture debt and term loans without pledging collateral — addressing one of the most persistent gaps in startup financing in India.

Eligibility

Borrowers cannot apply to NCGTC directly. Instead, eligible startups and enterprises access guarantee-backed loans through NCGTC's member lending institutions. For CGSS, the startup must be DPIIT-recognised, not in default to any lender, and meet the scheme's funding-cap and eligibility criteria. Lenders enrol as members of the relevant trust and pay an annual guarantee fee.

Impact and Track Record

NCGTC operates at national scale. Through schemes like ECLGS it channelled several lakh crore rupees of guaranteed credit to MSMEs during the pandemic, and through CGFMU and Stand-Up India it has supported millions of micro and first-generation entrepreneurs. As a government-backed trustee, it is one of the central pillars of India's financial-inclusion and collateral-free lending architecture.

Who Should Engage

Startups and MSMEs seeking collateral-free debt should approach banks, NBFCs or AIFs that are member institutions under NCGTC's schemes and ask specifically about CGSS or the relevant guarantee cover. Lending institutions looking to de-risk their MSME and startup portfolios can apply to become members of NCGTC's trusts.