Ministry of Micro, Small & Medium Enterprises, Government of India, on Friday, informed on the significant steps taken since Union Finance Minister Nirmala Sitharaman announced the revamping of Credit Guarantee Fund Trust for Micro & Small Enterprises (CGTMSE) in the Union Budget 2023-24.
Sitharaman had said that Rs 9,000 crore would be infused to the corpus to enable additional collateral-free guaranteed credit of Rs. 2 lakh crore to reduce the cost of credit by about 1 per cent with effect from 1 April 2023.
Consequent upon this, the following significant steps have been taken:
- The corpus of Credit Guarantee Fund Trust for Micro & Small Enterprises (CGTMSE) has been infused with a sum of Rs. 8,000 crore on 30 March 2023.
- CGTMSE has issued guidelines regarding reduction of annual guarantee fee for loans up to Rs. 1 crore from a peak rate of 2% per annum to as low as 0.37% per annum.
- The limit on ceiling for guarantees has been enhanced from Rs. 2 crore to Rs. 5 crore.
- For settlement of claims in respect of guarantees for loan outstanding up to Rs. 10 lakh, initiation of legal proceedings will no longer be required.
- CGTMSE also informed that it approved guarantees worth Rs. 1 lakh crore during FY 2022 – 23.
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