CGTMSE Expands Credit Support for MSMEs: Annual Report 2023-24 Highlights Record Growth

The Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) has released its annual report for the financial year 2023-24, showcasing record-breaking support for India’s Micro, Small, and Medium Enterprises (MSMEs). The report highlights an unprecedented increase in the number of guarantees issued, the total loan amount covered, and the trust’s expansion in ensuring financial inclusion across various sectors.

Record Growth in Credit Guarantee Support

In FY 2023-24, CGTMSE issued 12.5 lakh guarantees, marking a 30% increase from the previous year. The total credit amount covered under the scheme surged to ₹1.85 lakh crore, a substantial rise from ₹1.42 lakh crore in FY 2022-23. This increase reflects the growing reliance on CGTMSE’s framework by financial institutions and MSMEs seeking credit without collateral.

Among the major beneficiaries, first-time entrepreneurs accounted for nearly 45% of the total guarantees issued, indicating the scheme’s effectiveness in fostering new business ventures. The report also shows that micro-enterprises received 65% of the total guarantees, reinforcing CGTMSE’s focus on supporting the smallest players in India’s business ecosystem.

Sectoral and Inclusive Growth

The annual report underscores CGTMSE’s commitment to inclusive growth by broadening its coverage across various categories of entrepreneurs. Women-led enterprises received ₹22,000 crore in credit guarantees, reflecting a 25% increase compared to the previous year. Similarly, businesses owned by Scheduled Caste (SC) and Scheduled Tribe (ST) entrepreneurs saw a notable rise in guaranteed credit, with over ₹18,500 crore allocated to these enterprises.

Sector-wise, the manufacturing sector continued to dominate in terms of credit disbursement, receiving ₹85,000 crore in guarantees, while the services sector accounted for ₹60,000 crore. The agriculture and allied sectors also saw improved participation, with over ₹20,000 crore in guarantees extended to small agribusinesses and rural enterprises.

Digital Transformation and Efficiency Gains

CGTMSE’s report highlights the role of digital transformation in streamlining guarantee approvals. The integration of AI-driven credit risk assessment and online loan processing reduced approval times by 40%, significantly enhancing accessibility for MSMEs. Furthermore, over 90% of guarantee applications were processed digitally, cutting down bureaucratic delays and promoting faster credit disbursement.

Post-Pandemic Recovery and Future Roadmap

As MSMEs continued to recover from pandemic-related disruptions, CGTMSE extended support through relaxed guarantee conditions and extended repayment tenures. The trust’s Emergency Credit Line Guarantee Scheme (ECLGS) played a crucial role in stabilizing over 3.5 lakh MSMEs, injecting much-needed liquidity into the sector. Looking ahead, CGTMSE aims to:

• Reduce guarantee fees for micro-enterprises.
• Expand credit coverage for women-led and rural enterprises.
• Introduce sector-specific guarantee schemes for high-growth industries like green energy and export-oriented businesses.

The CGTMSE Annual Report 2023-24 reaffirms the trust’s commitment to strengthening India’s MSME ecosystem. By ensuring seamless access to collateral-free credit, promoting digital innovation, and prioritizing inclusive financial support, CGTMSE continues to be a critical pillar in India’s economic growth. With ambitious expansion plans, the trust is poised to further empower small businesses and contribute to the nation’s vision of becoming a global economic powerhouse.