Practical No: 5
Aim: -Visit a Bank/Financial Institution to enquire about various funding scheme for a
small & medium enterprise.
1. Credit Guarantee Scheme for Startups (CGSS)
The CGSS is one of the best government schemes for MSMEs. Under the scheme, Indian
startups can avail themselves of collateral-free loans. This scheme offers startups a credit
guarantee of up to ₹ 10 crores at a nominal fee of just 2% per annum. With the funds received,
startups can fulfil several aspirations, including business expansion, buying new equipment, etc.
The Department for Promotion of Industry and Internal Trade (DPIIT) must recognise your
startup for you to avail funds under CGSS. Also, to get the required funds under this scheme,
your startup must have a stable revenue stream and shouldn't default on any loans taken from any
lending institution.
2. Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) is a loan scheme
introduced by the Government of India in partnership with SIDBI (Small Industries
Development Bank of India). Through it, MSMEs can avail collateral-free Business Loans from
the government at a nominal guarantee fee only.
The scheme covers both Term Loans and Working Capital Loans up to ₹ 5 crores, thereby
reducing the risk for lenders and encouraging them to extend financial support to MSMEs. The
government provides a credit guarantee cover of up to 85% of the sanctioned loan amount.
All eligible businesses in the manufacturing and services sectors can apply for the CGTMSE
scheme through a simple online application process.
3. Pradhan Mantri MUDRA Yojana
The Pradhan Mantri MUDRA Yojana (PMMY) is one of the best government schemes for
MSMEs in India. Launched in 2015, it aims to promote entrepreneurship among small business
owners by providing financial assistance of up to ₹ 10 lakhs in the form of Working Capital
Loans, Term Loans, and microfinance.
MUDRA loans are categorised into three categories:
Shishu loans of up to ₹ 50,000
Kishor loans ranging between ₹ 50,000 and ₹ 5 lakhs
Tarun loans ranging between ₹ 5 lakhs to ₹ 10 lakhs
MSMEs into in manufacturing, trading, and service activities can apply for MUDRA loans
without any collateral or security.
4. Prime Minister’s Employment Generation Program (PMEGP)
The Prime Minister’s Employment Generation Program (PMEGP) is a credit-linked subsidy
scheme under the Ministry of MSMEs. It aims to promote self-employment opportunities by
providing financial assistance for establishing new micro-enterprises and generating employment
in both rural and urban areas.
Under this scheme, eligible entrepreneurs can get Business Loans of up to ₹ 50 lakhs for
establishing manufacturing projects and up to ₹ 20 lakhs for establishing service-sector projects.
The subsidy component may vary from 15% to 35%, depending on the category and location of
the project.
5. Stand-Up India Scheme
The Stand-Up India scheme is a flagship government initiative launched to promote
entrepreneurship among women, Scheduled Castes (SCs), and Scheduled Tribes (STs) by
providing them access to financial support and handholding assistance. Under this scheme,
eligible borrowers can avail of loans ranging from ₹ 10 lakhs to ₹ 1 crore to set up greenfield
enterprises in manufacturing, trading, or service sectors. Beneficiaries can avail
of overdraft and cash credit facilities on Working Capital Loans
Conclusion: Hence, I have Visit a Bank/Financial Institution to enquire about various
funding scheme for a small & medium enterprise.
Dated Signature of Teacher
Marks Obtained
Process Product Total
(10) (15) (25)
