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Corporate Laws Central Ministry of Commerce and Industry Deposit Insurance and Credit Guarantee Corporation Act, 1961

Credit Guarantee Scheme for Startups (CGSS)

08-May-2025 | S.O. 2046(E)

Ministry of Commerce and Industry has notified the Credit Guarantee Scheme for Startups (CGSS) effective from 8th May, 2025.

Key Highlights are as follows:
1. The Central Government has approved the "Credit Guarantee Scheme for Startups (CGSS)" for the purpose of providing credit guarantees to loans extended by Member Institutions (MI) to finance eligible borrowers being Startups.
2. In Para 5, Lending or investing institutions that are eligible under the scheme are specified, which includes:
i)Scheduled Commercial Banks and Financial Institutions.
ii)RBI-registered NBFCs with minimum BBB credit rating, Net worth of at least Rs. 100 crore.
iii)SEBI-registered Alternative Investment Funds (AIFs).
3. For availing the guarantee cover, the Member Institution shall pay Annual Guarantee Fee (AGF) of 2% p.a. of the disbursement/outstanding amount as on the date of application of guarantee cover (Para 8.i).
4. A Management Committee (MC) to oversee the affairs of the Trust and Risk Evaluation Committee (REC) to assess the overall risk parameters of the scheme, shall be constituted by the DPIIT (Department for Promotion of Industry and Internal Trade (Para 15 and Para 16).
5. Under umbrella - based guarantee, updates on the performance of the portfolio shall be submitted by the VDF (Venture Debt Fund) on a
quarterly basis (Para 19.iv).
6. The current scheme supersedes the earlier Gazette notification S.O. 4741(E) dated 06th October 2022 on Credit Guarantee Scheme for Startups (CGSS).

Kindly refer to the attached document for more information.

Upgrade to paid version to access the Notification, Circular & Rules along with the checklist

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