CGTMSE Scheme: Full Form, Eligibility, Benefits, Fees, and How to Apply

Under the current CGTMSE scheme, eligible credit facilities can receive guarantee cover up to Rs. 10 crore per borrower. The amount a lender actually sanctions depends on the business’s requirements, viability, financial position, and the lender’s credit policy.

The Rs. 10 crore figure is the maximum credit facility eligible for guarantee cover under the scheme; it is not an automatic entitlement or a grant from CGTMSE. If a facility exceeds the cover limit, the amount above the applicable limit is not covered by the Trust.

DPIIT-recognised startups may be covered under separate startup credit-guarantee arrangements, subject to their own rules. Do not assume that a startup-related limit or eligibility condition under another scheme automatically applies to CGTMSE’s MSE scheme.

The percentage of credit risk covered under CGTMSE depends on the facility, borrower category, and current scheme provisions. Standard coverage is commonly 75%, while certain eligible categories may receive enhanced coverage under specific conditions.

The coverage percentage is the portion of eligible lender risk supported by the guarantee; it is not a discount on your loan principal or a waiver of repayment. 

The lender remains responsible for appraising the application and following CGTMSE’s requirements.

Coverage categories and special provisions can change. Ask your MLI to confirm the percentage applicable to your business and facility, and verify it against the latest official CGTMSE scheme documents before relying on a figure.

The Annual Guarantee Fee (AGF) is a scheme fee payable to CGTMSE by the participating lender. Depending on the lender’s terms, this cost may be passed on to you or absorbed by the lender, so confirm the treatment in your sanction letter.

For guarantees approved or renewed on or after 1 April 2025, the official standard AGF rates are shown below. The first-year fee is charged on the guaranteed amount; subsequent-year fees are charged on the outstanding amount, subject to the scheme rules.

CGTMSE standard AGF rates

Last reviewed: 15 October 2026

These are standard rates, not necessarily the final fee for every case. Discounts or risk premiums may apply under CGTMSE rules, and the lender’s own interest and other charges are separate. 

New and existing micro and small enterprises may be considered for CGTMSE cover if their activity, credit facility, and lender meet the scheme requirements.

Eligibility is assessed by the participating lender, and meeting a general category does not guarantee sanction.

• Your business falls within the eligible micro or small enterprise category and has the required Udyam registration.
• Your activity is eligible under the current scheme rules, including qualifying manufacturing, service, and retail or wholesale trade activities where permitted.
• You apply for an eligible credit facility through an MLI registered with CGTMSE.
• Your business meets the lender’s credit, documentation, viability, and repayment-capacity requirements.
• The facility meets the applicable collateral-free or hybrid-security conditions under the scheme.

The scheme excludes certain borrowers and credit purposes. Confirm any sector-specific exclusions, hybrid-security conditions, and current eligibility rules with the lender and CGTMSE before applying.

Depending on the scheme rules and the lender’s assessment, eligible facilities may include term loans, working-capital credit, and composite facilities that combine both.

• Term loan: funding for eligible fixed-asset or business investment needs.
• Working-capital facility: credit to manage day-to-day operating requirements, such as inventory or receivables.
• Composite facility: a combination of term credit and working capital, where permitted.
• Other eligible fund-based or non-fund-based facilities, subject to the current scheme provisions.

The exact facility, end use, security structure, and guarantee treatment must be confirmed with the MLI. Not every business loan or credit product is automatically covered by CGTMSE.

The exact document list depends on your business structure, lender, and facility. Prepare the following where applicable, and ask the MLI for its current checklist before submitting your application.

• Udyam Registration Certificate.
• PAN and identity/address proof for the proprietor, partners, directors, or authorised signatories.
• Business constitution documents, such as a partnership deed or company incorporation documents.
• Business plan or project report with the proposed use of funds and financial projections.
• Available financial statements, income-tax returns, and GST registration details, where applicable.
• Recent business bank statements and supporting quotations or invoices for planned purchases, where relevant.

Incomplete records, unclear projections, discrepancies in tax or bank information, and weak evidence of repayment capacity may delay assessment or affect the lender’s decision.

You apply through a registered Member Lending Institution, not directly to CGTMSE. The lender determines whether your facility qualifies and handles the guarantee application if the loan is sanctioned.

• Check your business’s Udyam registration and confirm that your activity is eligible under the current scheme.
• Identify a participating MLI and discuss the amount, purpose, facility type, and applicable security conditions.
• Prepare the lender’s application form and supporting business, KYC, and financial documents.
• Submit the application and respond to requests for clarification, additional records, or revised projections.
• Review the sanction terms, interest rate, repayment schedule, and any guarantee fee passed on to you.
• After sanction, the lender completes the relevant CGTMSE guarantee process under the scheme rules.

Do not rely on a fixed guarantee-approval timeline unless your lender confirms it for your case. Processing time depends on the completeness of your application, credit appraisal, and the lender’s and scheme’s procedures.

Last reviewed: 15 October 2026

CGTMSE is not a subsidy, an interest-rate concession, or a debt waiver. Consider the full cost of credit and your expected cash flow before accepting a loan.

CGTMSE and CGFMU are different credit-guarantee arrangements, so you should not treat their eligibility rules or limits as interchangeable.

Last reviewed: 15 October 2026

Because scheme limits and operational provisions can change, confirm the latest details from the official scheme administrator and your lender before choosing a facility.

While the CGTMSE scheme helps eligible micro and small enterprises access credit through guarantee support to participating lenders, businesses may also explore other financing options to meet their funding requirements. If you need funds to manage working capital, purchase inventory, or expand your operations, a Bajaj Finance Business Loan is another option to consider, subject to its eligibility criteria and lending terms.

You can apply for a loan amount ranging from Rs. 2 lakh to Rs. 80 lakh, subject to business loan eligibility and further assessment. The available options include Term Loan, Flexi Dropline Loan, and Flexi Hybrid Loan. Before choosing a financing option, compare the eligibility requirements, applicable charges, repayment terms, and funding needs of your business to make an informed decision.

• Click the 'Check Loan Offer' button to open the online application form.
• Enter basic details, including Name, PAN, Date of Birth, PIN Code, and Business details, and click 'CONTINUE'.
• Complete banking verification and continue.
• View your offer details, select the loan type — Term Loan, Flexi Dropline Loan, or Flexi Hybrid Loan — and choose the repayment tenure.
• Review the details and submit the business loan application.