Question
As per the Credit Guarantee Scheme for Micro and Small
Enterprises (CGS-MSE), what is the maximum credit facility limit eligible for guarantee coverage when extended by Public Sector Banks, Private Sector Banks, Foreign Banks, and select Financial Institutions?Solution
The Credit Guarantee Scheme sets different maximum credit facility limits depending on the type of lending institution: • For Public Sector Banks, Private Sector Banks, Foreign Banks, and select Financial Institutions, the maximum eligible credit per borrower is ₹10 crore. • For Regional Rural Banks (RRBs), the maximum limit is ₹2 crore. • For Microfinance Institutions (MFIs), the maximum limit is ₹50 lakh. This differentiation ensures that larger institutions with greater capacity can extend higher volumes of guaranteed credit, while smaller institutions operate with lower thresholds tailored to their lending reach.
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