Mutual Credit Guarantee Scheme for MSMEs

In February 2025, the Government approved the Mutual Credit Guarantee Scheme (MCGS) to support MSMEs, aligning with the 2024-25 Budget initiative to boost the manufacturing sector.

Key Features of MCGS

(i) Credit Guarantee Coverage

  • Provides 60% guarantee through the National Credit Guarantee Trustee Company Ltd. (NCGTC) to banks and NBFCs.

(ii) Eligibility Criteria

  • MSMEs with valid Udyam Registration.
  • At least 75% investment in machinery.
  • No NPA classification.

(iii) Operational Tenure: Four years or until Rs. 7 lakh crore in guarantees are issued.

(iv) Loan Terms

  • Up to Rs. 50 crore: Eight-year repayment period, including a two-year moratorium.
  • Above Rs. 50 crore: Flexible repayment terms.

Do You Want to Read More?
Subscribe Now
To get access to detailed content

Already a Member? Login here

Take Annual Subscription and get the following Advantage
The annual members of the Civil Services Chronicle can read the monthly content of the magazine as well as the Chronicle magazine archives.
Readers can study all the material since 2018 of the Civil Services Chronicle monthly issue in the form of Chronicle magazine archives.
Be an Annual Subscriber

Current Affairs