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CGTSME Scheme

Under CGTSME Scheme both new & existing micro small medium enterprises MSME borrowers get up to 2 Cr without Pledging any Collateral.
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What is CGTMSE?  

The government of India has initiated various schemes to support micro small medium enterprises sector in India by providing a credit facility, where one such scheme is CGTMSE launched in 2000 by MoMSME & SIDBI.  

Under both Ministry of Micro Small Medium Enterprises Government of India (MoMSME) & Small Industries Development Bank of India (SIDBI) together initiated a scheme known as CGTMSE Scheme; it aims to provide financial assistance to micro small medium enterprises (MSME) without any collateral guarantee.  

CGTMSE full form Credit Guarantee Fund Trust for Micro and Small Medium Enterprises. Through this Scheme both new & existing businesses able to get funded  

Key Features  

  • Under the CGTSME Scheme borrowers gets up to 2 Cr  
  • The collateral-free loan is available  
  • Guarantee covered up to 75% of advance  
  • Term loan for Capital Expansion  
  • Working capital loan to meet day-to-day operational expenses  
  • Loan for MSME engaged in manufacturing & services sector  
  • CGTMSE fee charges 1% per annum on loan amount  

Which Units are eligible to get CGTMSE Loan?  

Manufacturing & services sector are eligible to get benefits from this credit scheme. There are a few service sectors excluded from CGSTMSE scheme as under given: -  

  • Retail Trade  
  • Agriculture  
  • Training Institutions  
  • Self Help Groups  
  • Educational Institutions  

Also Read:-Supplier credit and Buyers credit

CGTMSE Scheme Eligibility Criteria  

CGTSME scheme has certain eligibility criteria that need to be checked before application. Kindly through the following points: -  

  • Private limited companies/sole proprietor firm/partnership firm or public limited companies.  
  • All micro & small units engaged in manufacturing & services sector.  
  • New & existing businesses both are eligible.  
  • SMEs owned by women entrepreneurs are also eligible.  
  • Entity involved in retail trade, agriculture, educational & training segment is not eligible.  

Documents Required for CGTMSE Scheme

Credit Guarantee Fund Trust for Micro and Small Medium Enterprises requires the following documents to be submitted at the time of loan application.  

  • Application form  
  • Attach passport sized photographs  
  • Business plan along with project report  
  • Company registration certificate  
  • CGTMSE loan coverage letter  
  • Copy of loan approval from the bank  

How to apply for CGTMSE Scheme Online 

Step 1: - Determine nature of the business by incorporating legal business entity (e.g) Private limited companies/sole proprietor firm/partnership firm or public limited companies.  

Step 2: - Present a business plan along with a project report to forecast your business projection to lenders from the material procuring to generating revenue.  

Step 3: - Once the above steps are cleared, Approach for bank loan to get sanction as it takes a bit of time to go through applicant proposal & evaluate financial part which includes working capital of business. Most probably crucial portion to determine borrower application.  

Step 4: - If the bank provides a sanction to your application, it's time to get a coverage letter. Afterward, visit CGTMSE official site to download the online application form.   

Step 5: - If all seems to be good then only CGTMSE provides approval for letter. Finally, you have to pay certain application fees & other services charges.  

 Also Read:-Home loan EMI calculator

CGTMSE Scheme FAQ 

How to check CGTMSE Scheme Eligibility? 

Both new & existing enterprises are eligible who are engaged in manufacturing & service sectors. 

What are the benefits of CGTMSE Scheme? 

Under this scheme upto 2 Crore are granted that too without pledging any collateral nor involvement of third party. 

How much loan can be availed in CGTMSE Scheme? 

Under this credit scheme, enterprises can get loan upto 2 Crore. 

What factors determine to get CGTMSE Scheme? 

There are certain factors determined to evaluate borrowers repayment capacity such like creditworthiness, credit history & financial track record. 

What facility include by CGTMSE Coverage?  

Generally, Under the CGTMSE Coverage guarantee covers 50% of sanctioned loan amounts ranging 10 lacs to 1 Cr. 

How much interest Rate applicable on CGTMSE Scheme? 

Bank charges 14% - 18% per annum that also includes guarantee scheme. 

Is CGTMSE Scheme require collateral to get loan? 

No collateral is required as this scheme gives the benefits of collateral free loan. 

Does CGTMSE fees are refundable? 

As per certain norms CGTMSE fees are non-refundable, therefore make sure fee paid in favor to this scheme shall not be refunded. 

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