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CGTMSE - A Driving Force for MSMEs

All you need to know about CGTMSE Loan Scheme for MSMEs

CGTMSE scheme for MSMEs

The Government of India, through the Ministry of MSMEs in collaboration with the SIDBI, jointly established a trust CGTMSE. It was officially launched on 30th  August 2000. Its primary objective is to offer credit guarantees to financial institutions that provide loans to MSMEs.

Additionally, the CGTMSE scheme for MSMEs also encompasses partial collateral loans and retail trade, as part of the Rebooting CGTMSE initiative.

CGTMSE Loan Consultant

All the emerging businesses in India, micro, small, or medium, are in constant need of finances. Whether it’s for expansion, purchasing heavy machinery, paying creditors, addressing working capital issues, or settling outstanding dues.

Unfortunately, many of these businesses lack the financial knowledge needed to secure the funding they need. Hence, we at Terkar Capital come into the picture to provide consulting to help MSMEs raise required finances.

Features of CGTMSE loan Scheme

  • The initiative helps small businesses grow in a competitive market through accessible loans
  • It also aims at strengthening the credit lending facility to developing industries and helping them raise funds for the same.
  • Collateral-free loan offers a fast and convenient process
  • It provides guarantee cover for lenders to protect against losses in case of borrower default. Coverage lasts for the loan’s entire term.
  • The CGTMSE coverage ranges from 70-85% in case of non-payment by the borrower.
  • CGTMSE offers guaranteed coverage ranging from 50% to 85%, subject to meeting specific eligibility requirements.
  • The maximum number of funds availed in this scheme is Rs. 500 Lacs (i.e. Rs 5 Cr)
  • CGTMSE provides good guarantee covers to North East Region Women Entrepreneurs as well and encourages them to expand their businesses.

Procedure for CGTMSE loan scheme

1. Prepare a project report/ business plan

The crucial step is preparing the project report or a business plan. It has to be submitted to the lending company. Here the lending company will scrutinize whether the company is eligible under the scheme or not.

2. Scrutiny of documents

The lending institution or company will do a thorough investigation of the required documents and proceed with loans.

3. Sanction the loan

a. Prepare a project report/ business plan

The crucial step is preparing the project report or a business plan. It has to be submitted to the lending company. Here the lending company will scrutinize whether the company is eligible under the scheme or not.

b. Scrutiny of documents

The lending institution or company will do a thorough investigation of the required documents and proceed with loans.

c. Sanction the loan

The lender will sanction your loan after duly verifying your documents.

d. Obtain CGTMSE cover

Once the loan is sanctioned by the bank, the bank will apply to the CGTMSE organization and obtain the CGTMSE loan scheme for MSMEs to cover the loan sanctioned. After obtaining the loan, the customer will have to pay service charges or fees as per the requirement.

Learn the process of CGTMSE Funding from the case study.

How much is CGTMSE fees?

The trust fund charges 1% p.a. of the amount so approved as fees:

  • 0.75% – for loans of up to Rs. 5 Lakhs
  • 0.85% for loans above Rs. 5 Lakhs but up to Rs. 100 Lakh.

The credit guarantee available below this scheme is 75/80% of the amount so transmitted to a maximum cap of Rs. 62.5 Lakh / 65 Lakh for a loan facility of up to Rs. 50 Lakhs. The percentage guarantee implies 85% for microenterprises for up to Rs. 5 lakhs. The guarantee percentage is 50% of the amount approved for a credit of above Rs. 50 Lakhs with a maximum limit of Rs. 100 Lakhs. The ownership of the guarantee is a block of 5 years.

Eligibility for CGTMSE (Borrower)

1. The applicant must be categorized as micro and small enterprises.

2. CGTMSE cover is available for Loans to Micro and Small Enterprises engaged in manufacturing or service activities.

3. CGTMSE cover is not available for loans to enterprises engaged in retail trade, educational institutions, training centres, self-help groups, and agriculture.

4. The business must have at least 3 years of continuity.

Eligible Lending Institution:

CGTMSE has designated Member Lending Institutions (MLI) which can provide loans to MSMEs. In this list, there are Government Banks, Scheduled Commercial Banks, Regional Rural Banks, NBFCs, Financial Institutions, etc. who have signed an agreement with the CGTMSE ministry.

Why Terkar Capital?

Terkar Capital is a leading CGTMSE loan consultant in India, specializing in empowering MSMEs through CGTMSE loans. We understand the financial needs of emerging businesses, especially MSMEs in India. Our goal is to provide personalized consulting services to help MSMEs secure the necessary funding for their expansion, machinery purchases, working capital, and more.

We offer a range of financial products, including secured and unsecured funding options, tailored to meet the specific requirements of borrowers. One attractive funding option for MSMEs is the CGTMSE loan, which now offers an extended credit limit of up to Rs 5 crore.

9 Responses
        1. Hello,

          Thank you for writing to us. We will be glad to work on your working capital requirement under CGTMSE. We will send you the email. Request you to kindly share your contact number, so we can discuss the requirement in detail.

          Thank You.

          Best Regards,
          Team – Terkar Capital

  1. Sachindra nath panda

    Sit i want to take msme loan to start a whole sale distribution house of cardamom and other spicess in nrw delhi is it possible if possible what is the procedure kindly send your advice through my e mail as arly as possiblr

    1. Dear Mr. Panda,
      Thank you for sharing the details. We can raise the proposed amount of funds. We will drop you with the email for the required inputs. You can also contact us on – 8308629820

      Thank You.
      Best Regards,
      Team – Terkar Capital

  2. R. P.infraheight Pvt Ltd

    We are a start-up India recognised construction company in all type of civil electrical transmission distribution work & service industry, we achieve govt order from Indian railways, We can apply credit facility under CGTMSE scheme so kindly help us?

  3. Mukesh

    I am interested to apply for a loan for my company under CGTSME.Please guide the procedure. I am in manufacturing line and with a continuity of 11 years.

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