Revamped CGTMSE Scheme

In News

• CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises) has been provided with an additional corpus support of ?9,000 crore in the Union Budget for FY 2023-24 to revamp its Scheme to provide guarantee for additional ?2 lakh crore to Micro & Small Enterprises.

More changes in CGTMSE

• The modifications included reduction in guarantee fees for loans up to ?1 crore by 50% bringing the minimum guarantee fee to the level of 0.37% pa only.
• Another major change announced was raising of ceiling for guarantee from ?2 crore to ? 5 crore
• Enhancing the threshold limit for claim settlement without initiation of legal action to ?10 lakh.

What is CGTMSE?

• CGTMSE is jointly set up by the Ministry of Micro, Small & Medium Enterprises (MSME), Government of India and Small Industries Development Bank of India (SIDBI) to catalyze flow of institutional credit to Micro & Small Enterprises (MSEs).
• Established in 2000, CGTMSE has been instrumental in providing:

Guarantee cover to collateral and/or third party guarantee free credit facilities 

• CGTMSE has created a new landmark by touching the milestone figure of approving guarantees worth `1 lakh crore during FY 2022 – 23.

For further reading on MSME, kindly follow this link https://www.nextias.com/current-affairs/14-03-2022/micro-small-and-medium-enterprises-msmes-sector