The beneficial Credit Guarantee Scheme for Startups from the Indian government aims to offer credit guarantees, for loans that startups need. Thus, the CGTMSE or Credit Guarantee Scheme for Startups offers funding support to businesses like yours in India which in turn helps your business grow and succeed.
Benefits of Credit Guarantee Scheme for Startups
1. Loan Guarantee
CGTMSE assures credit for micro and small enterprises, reducing risk for banks and NBFCs.
2. Loan Amount
Collateral-free loans available under CGTMSE, with limits subject to periodic review based on regulatory changes.
3. Loan Tenure
Flexible repayment options, allowing borrowers to tailor loan tenure to their business nature and cycles.
4. Wide Coverage
Encompasses diverse business activities, making CGTMSE a versatile financing option across various sectors.
5. Reduced Collateral Requirement
Overcomes a common hurdle by primarily offering collateral-free loans, addressing the lack of collateral for micro and small enterprises.
6. Competitive Interest Rates
CGTMSE provides loans with competitive interest rates, enhancing its appeal as a financing solution for entrepreneurs.
7. Smoother Access to Credit
Encourages financial institutions to support high-risk businesses, fostering economic development and innovation.
Eligibility Criteria for applying Credit Guarantee Scheme for Startups
- Businesses must have MSME Registration and Startup India Certification
- Startups demonstrating a stable revenue stream, verified through 12 months of audited monthly statements
- Startup that have no default to any lending/investing institution and not classified as Non-Performing Asset as per RBI guidelines
Document Requirement for Credit Guarantee Scheme for Startups
- Completed CGTMSE loan application form, accompanied by the necessary passport-sized photographs.
- Certificate of Business Incorporation or Company Registration.
- Pitch Deck.
- CGTMSE Loan Coverage Letter.
- Copy of the loan approval issued by the bank.
- Any additional documents requested by the bank.
Process to apply for CGTMSE
- Obtain Startup India Certification DPIIT to qualify for benefits under the scheme.
- Approach the funding institutions with your funding requirements, and they will evaluate your application based on general lending protocols, scheme guidelines, and other criteria.
- Eligible institutions then must register under the scheme by submitting a signed undertaking, using the format available on the official website, along with a Board Resolution.
- Upon successful registration of the Member Institution (MI), login credentials will be created for the MI on NCGTC’s portal.
- The MI can then proceed to apply for guarantee cover on NCGTC’s portal.
Learn More about Startup India Certificate:
If you have any other doubts or need to apply for CGTMSE, you must know that our professionals can assist you in that. You can contact us right now at: 8881-069-069
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