Which is the scheme through which MSME gets a loan of up to Rs 100 crore, this is how you will get the benefit..

In early 2025, the Modi government approved a scheme that would allow micro, small, and medium enterprises to receive loans of up to ₹100 crore. Today, we'll tell you about this scheme and how you can obtain a loan to expand your business through this scheme.

This scheme is called the Mutual Credit Guarantee Scheme. Its purpose is to improve credit availability for the micro, small, and medium manufacturing sector. This scheme is in line with the Make in India targets set for the MSME sector in the Union Budget 2024-25.

When this scheme was approved, the Finance Ministry stated that the manufacturing sector currently contributes 17 percent to India's GDP and employs over 27.3 million workers.

How can I get a loan of up to ₹100 crore under the Mutual Credit Guarantee Scheme?
An MSME can primarily avail loans up to ₹100 crore through the new Mutual Credit Guarantee Scheme (MCGS-MSME). This scheme provides lenders with a 60% government guarantee for loans up to this amount, primarily for the purchase of equipment and machinery. To qualify, MSMEs must have a valid Udyam registration and be engaged in manufacturing. Eligible MSMEs must apply through a Member Lending Institution (MLI), such as a bank or NBFC, which will then process the guarantee request through the NCGTC portal.

What are the requirements for availing a loan through the Mutual Credit Guarantee Scheme?
Your business must be an eligible MSME with a valid Udyam registration number.

Your business must be engaged in manufacturing activities.

You must not have any overdue loan repayments.

Select an MLI and Apply

Identify and contact a Member Lending Institution (MLI).

These include banks, Authorized Financial Institutions (AIFIs), and eligible NBFCs.

You can contact them directly or use online platforms like PSB Loans in 59 Minutes.

Fill out the application form for the MCGS-MSME scheme.

Provide all required documents, including financial statements and a business plan focused on purchasing machinery and equipment.

To be guaranteed a loan, the project cost must cover at least 75% of the equipment/machinery purchase.

You will need to make an initial contribution of 5% of the loan amount.

The MLI will evaluate your application and request guarantee cover from the National Credit Guarantee Trustee Company Limited (NCGTC).

After receiving approval from both the MLI and NCGTC, sign the loan agreement.

The loan amount will be disbursed upon successful completion of all the formalities.

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