MCGS-MSME is a Scheme that enable term loans up to Rs.100 crore to Micro, Small, and Medium Enterprises (MSMEs) from Eligible Lending Institutions.
Other Salient Features of MCGS-MSME
- Trust /Fund: Mutual Credit Guarantee Fund-MSME (MCGF-MSME) is created to manage the Scheme.
- Formed by Department of Financial Services (DFS), Ministry of Finance & managed by National Credit Guarantee Trustee Company Limited (NCGTC), a wholly owned company of DFS.
- Guarantee Coverage: Offers 60% guarantee coverage by NCGTC to MLIs for loans sanctioned under MCGS-MSME.
- Member Lending Institutions (MLIs): They are Financial Institutions such as Commercial Banks, NBFCs registered with NCGTC under the Scheme.
- Eligible Borrower: MSME with valid Udyam Registration; Not a Non-Performing Asset with any lender; Minimum 75% of project cost for equipment/machinery.
- Duration of the Scheme: Available for 4 years or until Rs 7 lakh crore in guarantees are issued, whichever comes first.
Impact of MCGS-MSME
- Boost to Manufacturing: Enhances credit access for MSMEs to expand and upgrade equipment.
- Support for Make in India: Strengthens domestic manufacturing, increasing its GDP share towards 25%.
- Global Competitiveness: Helps MSMEs scale up, positioning India as a key global supply chain player.
