MSME ministry starts nationwide Credit Guarantee Scheme
20 Feb 2018 5:51 PM GMT
New Delhi: Ministry of Micro, Small and Medium Enterprises (MSME) has launched the Credit Guarantee Scheme (CGS) to strengthen credit delivery system and facilitate the flow of credit to the MSE sector without the hassles of collateral and third party guarantee.
For operationalising the scheme PAN India, Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) was set up in August 2000 with a committed corpus of Rs. 2,500 crore. Recognising the contribution made by CGTMSE so far, Government of India has decided to increase the corpus of the Trust to Rs. 7,500 crore.
It facilitates access to finance for un-served and under-served geographies, making availability of finance from conventional lenders to new generation entrepreneurs and under privileged who lack supporting their loan proposal with collateral security and/or third party guarantee.
The main objective of the scheme is that lender should give importance to project viability and secure the credit facility purely on the primary security of the assets financed. The other objective is that lender availing guarantee facility should endeavour to give composite credit (term loan and working capital facilities from single agency) to the borrowers. Presently, the projects upto Rs. 200 lakh are being guaranteed by CGTMSE on automated digital platform.
In its over 17 years of operations, CGTMSE has approved 30 lakh of guarantees covering loans amounting to over Rs. 1.44 lakh crore and 166578 numbers of claims have been settled for an amount of Rs. 4323.39 crore on a cumulative basis. The units supported by CGTMSE have generated employment to the tune of 99 lakh and contributed Rs. 8379 crores towards exports. Approximately, 16% women and 8% SC/ST/Minorities entrepreneurs were benefited by the scheme.
The LOGO of the Trust was unveiled in an event" REBOOTING CGTMSE" jointly organised by Ministry of MSME, GoI, SIDBI and CGTMSE on February 20, 2018 in the presence of Minister of State (I/C), Ministry of MSME Giriraj Singh.
Besides the Minister the event was attended by Dr Arun Kumar Panda, Secretary, Ministry of MSME; Rajiv Kumar, Secretary, Department of Financial Services, Ministry of Finance; Ram Mohan Mishra, Additional Secretary cum Development Commissioner (MSME), Ministry of MSME; and Mohammad Mustafa, Chairman and Managing Director, Small Industries Development Bank of India (SIDBI).
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