Funding under CGFMSE (Collateral Free Loans)

  • Funding under CGFMSE (Collateral Free Loans)

Providing adequate security for the facility availed by the micro/small enterprises units (MSEs) has been a major roadblock for their inability to access banking system. Keeping this in view, Government of India and SIDBI had set up "Credit Guarantee Fund Trust for Micro and Small Enterprises" (CGTMSE). On the basis of CGTMSE guidelines IDBI Bank offers collateral free loans up to Rs. 1 crore to realize the areas of those entrepreneurs who have viable Projects/ proposals but lacks adequate collateral security to offer.

The product details are as below:

Sr. No. Field Content
1 Eligible Segments
  • Micro/ Small Enterprise (manufacturing/ services) as defined under MSMED Act and by RBI
2 Purpose / Facility
  • Fund Based: Working Capital and Term Finance for capex/ takeover of existing loans
  • Non-Fund based limit viz., Bank Guarantee (BG) and Letter of Credit (LC)
3 Loan Amount
  •  Maximum: Rs. 1 Crore
4 Tenor
  • Cash Credit: 12 months
  • Term Loan: Max 5 years
  • Bill Discounting/Letter of Credit: upto 180 days
  • Bank Guarantee: Not to exceed 12 months
5 Pricing
  • Linked to Bank Base Rate and Rating
6 Security
  • Primary: Exclusive charge on current and fixed assets
  • No Collateral / Third party guarantee