Login to Internet banking
A brand-new experience - smarter, faster, and secured
Introducing the First-in-industry IDFC FIRST Bank's Super Account
Request a Callback
You gain a dedicated partner committed to helping you reach your full potential and achieve new heights
Know More- Account with Auto-Sweep FD
- Account for all Domestic businesses
- Account for Importers & Exporters
- Account for Start-ups
- Accounts for Trusts/Associations/Societies/Clubs
- Account for Merchants
- Account for Agri Traders
- Account for Self-employed professionals
- Special Purpose Accounts e.g. SNRR, RERA, EEFC
BRAVO (Auto Sweep)
Convert the idle funds in your current account into a fixed deposit with the BRAVO feature.
Know More
Streamline your export process with digital convenience with IDFC FIRST Bank's Export Solutions
Know More
Make more than one online payment in just a few clicks with IDFC FIRST Bank Bulk Payments
Know More
Most Searched
Enjoy Zero Charges on All Commonly Used Savings Account Services
Open Account Now
Download our app
Get instant help for all your queries in one place
Explore Personal
- Accounts
Tools & Calculators
Privilege Program
- Privilege Program
Unlock features, exclusively available
only on the IDFC FIRST Bank app
FinFIRST Blogs
What is CGTMSE? Everything MSMEs need to know about collateral-free loans
Key Takeaways
As a business owner, you can avail collateral-free loans of up to ₹10 crores through CGTMSE-backed lenders.
- This borrowing scheme offers zero requirement for any third-party guarantees—best for startups and micro businesses.
- CGTMSE provides special benefits for women, transgender entrepreneurs, and informal micro enterprises (IMEs).
- Lower fees + higher coverage = easier, more affordable credit access.
- IDFC FIRST Bank offers fast, digital MSME loans for growing businesses at favourable rates and extended tenures.
The Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) is a lifeline for entrepreneurs who wish to grow without worrying about collateral.
With enhanced credit limits, reduced guarantee fees, and special benefits for women, transgender, and informal micro enterprises (IMEs), CGTMSE is enabling thousands of small businesses to access easier, more affordable credit.
And if you are looking for fast, collateral-free business loans, IDFC FIRST Bank has excellent offerings that complement these schemes for Micro, Small, and Medium Enterprises (MSMEs).
READ MORE
What is CGTMSE?
CGTMSE is a government-backed scheme, which is jointly set up by the Ministry of MSME and Small Industries Development Bank of India (SIDBI) in the year 2000. The purpose is to encourage lenders to offer collateral-free loans to Micro and Small Enterprises (MSEs).
Rather than demanding security or third-party guarantees, banks and financial institutions (known as Member Lending Institutions or MLIs) are backed by a credit guarantee from CGTMSE.
CGTMSE loan – How it works
Under the CGTMSE scheme, when an MSE defaults on a loan, CGTMSE covers a significant portion of the lender's loss—making banks more confident in lending to smaller businesses. This boosts access to formal credit for new and existing enterprises that lack assets or property to pledge.From 1st April 2025 onwards, CGTMSE now offers credit guarantees of up to ₹10 crore, which is up from the earlier limit of ₹5 crore. This massive step-up benefits not just manufacturers and traders but even service providers across distinct sectors.
CGTMSE scheme eligibility
New and existing MSEs engaged in manufacturing or service activities qualify under the CGTMSE scheme. But enterprises involved in agriculture, Self Help Groups (SHGs) and Joint Liability Groups (JLGs) are excluded from coverage.
CGTMSE loan interest rate & fees
The interest rate on a CGTMSE-covered loan is decided by the lender (not CGTMSE), and it typically aligns with standard MSME loan interest rate norms.
Special discount
Transgender-run MSEs enjoy 10% concession on these fees and receive 85% guarantee coverage.
Women-led businesses now receive 90% guarantee coverage, helping them get loans on even better terms.
This makes the CGTMSE scheme especially suitable for micro traders, artisans, and rural entrepreneurs who often find formal loans hard to come by.
Whether you are a startup, trader, or service provider, you can access timely credit without pledging assets. The MSME loan interest rate is competitive in nature and structured to match growing businesses.
Looking for a quick and hassle-free business loan?
If you are an entrepreneur looking out for quick and direct funding at favourable terms, IDFC FIRST Bank’s business loan for MSMEs can give your enterprise the momentum it needs:
- Collateral-free loans of up to ₹1 crore
- Loans up to ₹50 lakh approved easily based on banking or GST returns
- Flexible repayment options i.e., option to choose between a term loan or dropline overdraft facility
- Quick disbursal through a fully digital and hassle-free process
- Smart planning with the business loan EMI calculator to estimate monthly outflow
Ending note
The CGTMSE scheme is a powerful tool that bridges the trust gap between small businesses and lenders, especially for those who lack assets or formal credit history. With expanded loan limits, reduced fees, and special inclusivity benefits for women, transgender, and informal businesses, it is a much-needed boost to the entrepreneurial vertical of India.
So, why wait? Explore MSME loans with IDFC FIRST Bank today and give your business the much-needed boost it deserves.
Disclaimer
The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.
The features, benefits and offers mentioned in the article are applicable as on the day of publication of this blog and is subject to change without notice. The contents herein are also subject to other product specific terms and conditions and any third party terms and conditions, as applicable. Please refer our website www.idfcfirst.bank.in for latest updates.
Summarize with AI
