Supreme Court Rebukes RBI for Remaining a Bystander as YES Bank Operated Clandestinely  ||  Supreme Court: Lower Fresh Bids Alone Cannot Justify Cancellation of an Auction  ||  Supreme Court Directs Delhi Police to Produce Section 163 BNSS Orders and Preserve CCTV Footage  ||  Supreme Court Affirms Menstrual Hygiene as a Fundamental Right, Warns States of Contempt  ||  Supreme Court Flags AI-Generated Fake Judgments Submitted in a Party’s Case Compilation  ||  Karnataka High Court: Vijay Mallya’s Flamboyant Lifestyle Hinders Settlement of Bank Claims  ||  Delhi High Court: Women can be Booked for Gang Rape without Physically Committing it  ||  Delhi High Court: Litigants Must Track Their Cases and Cannot Blame Lawyers for Their Own Inaction  ||  Allahabad High Court: Contract Workers Must Prove Work Parity With Regular Staff for Equal Pay  ||  Allahabad High Court Directs UP Trial Courts to Decide Maintenance Execution Cases Within Six Months    

Department for Promotion of Industry and Internal Trade notifies establishment of Credit Guarantee Scheme for Startups - (07 Oct 2022)

Commercial

The Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry has notified the establishment of the Credit Guarantee Scheme for Startups (CGSS) for providing credit guarantees to loans extended by Scheduled Commercial Banks, Non-Banking Financial Companies and Securities and Exchange Board of India (SEBI) registered Alternative Investment Funds (AIFs). The Scheme will act as a key enabler and risk mitigation measure for the lending institutions enabling collateral free funding to startups.

CGSS is aimed at providing credit guarantee up to a specified limit against loans extended by Member Institutions (MIs) to finance eligible borrowers viz. Startups as defined in the Gazette Notification issued by DPIIT and amended from time to time. The credit guarantee cover under the Scheme would be transaction based and umbrella based. The exposure to individual cases would be capped at Rs. 10 crore per case or the actual outstanding credit amount, whichever is less. In respect of transaction-based guarantee cover, the guarantee cover is obtained by the MIs on single eligible borrower basis. Transaction based guarantees will promote lending by Banks/ NBFCs to eligible startups. The extent of transaction-based cover will be 80% of the amount in default if the original loan sanction amount is up to Rs. 3 crore, 75% of the amount in default if the original loan sanction amount is above Rs. 3 crore, and up to Rs. 5 crore, and 65% of the amount in default if the original loan sanction amount is above Rs. 5 crore (up to Rs. 10 crore per borrower).

Along with institutional mechanisms for operationalizing the Scheme, DPIIT will be constituting a Management Committee (MC) and a Risk Evaluation Committee (REC) for reviewing, supervising and operational oversight of the Scheme. The National Credit Guarantee Trustee Company Limited (NCGTC) will be operating the Scheme. Prime Minister, Shri Narendra Modi launched Startup India Action Plan on 16th January 2016 to lay the foundation of Government support, schemes and incentives envisaged to create a vibrant startup ecosystem in the country. The Action Plan envisaged a Credit Guarantee Scheme to catalyze entrepreneurship through credit to innovators and encourage banks and other member institutions in the ecosystem for providing venture debt to startups.

Tags : CGSS   ESTABLISHMENT   NOTIFICATION  

Share :        

Disclaimer | Copyright 2026 - All Rights Reserved