Credit Guarantee Scheme for Startups: Expanded Limits and Fees
Why in the news
The Credit Guarantee Scheme for Startups was widened to ease collateral-free borrowing for DPIIT-recognised startups.
Key facts
| Aspect | Revised position |
|---|---|
| Limit | ₹20 crore (earlier ₹10 crore) |
| Cover | 85% up to ₹10 crore; 75% above |
| Annual fee | 1% (from 2%) in 27 Champion Sectors |
| Umbrella guarantee | Pooled investments; lower of 5% or ₹20 crore, on actual loss |
About the scheme
- Ministry: DPIIT, Commerce and Industry; aim is collateral-free credit by reducing lender risk.
- Eligibility: DPIIT-recognised, not NPA or in default.
- Lenders: scheduled banks; NBFCs rated BBB or better with ₹100 crore net worth; SEBI-registered AIFs.
- Guarantees are issued automatically via the NCGTC portal.
Exam angle
- Nodal body: NCGTC.
- Supports Viksit Bharat and Atmanirbhar Bharat goals.