SMEs to get major boost under CGTMSE

The major focus will be to help the small and micro industries in availing easy finance and   employment generation. The scheme has already provided employment to around 312.52 lacs last fiscal, and hopes to increase the figure this year.

The credit guarantee scheme was launched by the Government of India in 2000 to make available collateral free credit to the micro and small industries, which is one of the major hurdles for the small entrepreneurs.

It is operated by a special trust, which was set up jointly by the Government of India and Small Industries Development Bank of India (SIDBI).

The trust has provided a guarantee to around 97,200 cases by now at an investment of  around Rs 2, 701 crore, said O S Vinod, CEO of this trust body, speaking on the sidelines of  a press meet organised by  federation of Indian export organisation (FIEO) and federation of small and medium industries (FOSMI)in Kolkata.

As on March 31, 2008, around 50 per cent of the claims were settled for RS 10.23 crore.
The scheme which had initially started with a corpus of Rs 125 crore has reached around Rs 1,584 crore, and it may further rise to Rs 2500 crore if required, he said.

This will be however in a 4:1 ratio, with he Centre contributing 80 per cent and Sidbi the remaining 20 per cent of the corpus. 

The trust presently holds a fund of  Rs 2,000 crore .This apart the trust had also shelled out roughly Rs 10 crores in repaying the default loans.

Apart from launching a host of incentives for women and SC/ST owned SME's the company has also reduced the guarantee fee and annual service fee from 1.0 per cent to 0.5 pe rcent in respect of all loans upto Rs 5 lacs.

West Bengal ranks seventh in the credit guarantee scheme list with around 5300 cases reported till date and around Rs 233 crore which accounts for 8.6 per cent of the total fund of CGTMSE.