Lok Sabha Question No. 4033 (UNSTARRED), answered on 2025-08-18
Subject: Credit Guarantee Scheme for MSME in Uttarakhand
Ministry: FINANCE
Asked by: Shri Trivendra Singh Rawat

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA UNSTARRED QUESTION NO. 4033

ANSWERED ON MONDAY, 18 AUGUST, 2025/ 27 SRAVANA, 1947 (SAKA)

## CREDIT GUARANTEE SCHEME FOR MSME IN UTTARAKHAND

† 4033. SHRI TRIVENDRA SINGH RAWAT:

Will the Minister of FINANCE be pleased to state:

(a) whether the Government is aware that MSME units in Uttarakhand are not getting adequate credit facilities;

- (b)  whether Uttarakhand is being given priority  by the Government under CGTMSE (Credit Guarantee Scheme);
- (c) whether any special financial incentive scheme has been introduced to boost investments in the State; and

(d) whether any monitoring mechanism has been put in place by the Government for GST refund and disbursement of loans easily?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF FINANCE (SH. PANKAJ CHAUDHARY)

(a) Micro, Small and Medium Enterprises (MSME) sector has emerged as a highly vibrant and dynamic sector of the Indian economy, fostering entrepreneurship and generating employment opportunities at comparatively lower capital cost, next only to agriculture. Supporting the MSME sector has been a policy priority of Government of India. Various measures have been taken for increasing  access  to  credit  for  MSMEs  in  an  affordable  manner,  in  all  the  states  including Uttarakhand, which are provided in Annexure .

As informed by RBI, the MSME credit outstanding of Scheduled Commercial Banks (SCBs) in the state of Uttarakhand as on 31.03.2025 was ₹53,164 crore. It is further informed by RBI that Empowered Committees on MSMEs are constituted at the Regional Offices of RBI, under the Chairmanship  of  the  Regional  Directors  with  the  representatives  of  State  Level  Bankers' Committee  (SLBC)  Convenor,  senior  bank  officials,  representative  from  Small  Industries Development Bank of India (SIDBI), State Government and MSME Associations in the state to periodically review the progress in MSME financing as also revival and rehabilitation of stressed MSMEs.

As informed by State Level Bankers' Committee (SLBC), Uttarakhand, the disbursement of MSME loan  for  FY2024-25  was  at  ₹25,385  crore  against  the  target  of  ₹22,404  crore.  For FY2025-26, the disbursement target is ₹29,306 crore.

(b) The Ministry of MSMEs (MoMSME) and SIDBI jointly instituted Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) in the year 2000, to provide credit guarantees for loans upto ₹10 crore (w.e.f. 01.04.2025), extended by Member Lending Institutions to Micro and  Small  Enterprises  (MSEs).  As  informed  by  MoMSME,  about  1.51  lakh  guarantees amounting to ₹11,168 crore have been approved under the CGTMSE scheme as on 31.07.2025 in the state of Uttarakhand, on a cumulative basis. The MSE borrowers in special categories including  Women  Entrepreneurs,  SC/ST  Entrepreneurs  and  People  with  Disability,  ZED certified MSEs and MSEs situated in Aspirational District / credit deficient districts, in all the states  including  Uttarakhand  have  been  supported  through  additional  coverage  and  reduced guarantee fee, under the scheme.

(c) The Government of India implements various Central Sector and demand driven schemes / programmes for MSMEs in the country including Uttarakhand. These schemes/ programmes include Prime Minister's Employment Generation Programme (PMEGP), Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE), Pradhan Mantri Mudra Yojana (PMMY), PM Vishwakarma  (PMV), Micro  and  Small  Enterprises  -  Cluster  Development  Programme (MSE-CDP) and Raising and Accelerating MSME Performance (RAMP), MSME Champions Scheme, etc.

As informed by MoMSME, the Government of India has announced Fund of Funds viz. Self Reliant India (SRI) Fund to infuse ₹50,000 crore as equity funding in those MSMEs which have the potential and viability to grow and become large units. The total size of fund of ₹50,000 crore has a provision of ₹10,000 crore from Government of India and ₹40,000 crore through Private Equity  /  Venture  Capital  funds.  This  initiative  is  aimed  at  providing  growth  capital  to  the deserving and eligible units of MSME sector. As on 31.07.2025, 645 potential MSMEs have been assisted throughout  the  country of  which  5  MSMEs have  been  assisted in the  State of Uttarakhand.

(d) As informed by the Central Board of Indirect Taxes and Customs (CBIC), the government has established a comprehensive, multi-tiered monitoring mechanism for GST refunds, which includes:

- i. GSTN-ICEGATE integration has been enabled for IGST refunds, enabling SMS alerts and real-time status updates.
- ii. Processing of refunds has been streamlined by introducing a "single disbursement window" and  fixed  refund  processing  timelines  which  include  provisional  refunds  and  interest  for delays beyond 60 days.
- iii. National Coordination Meeting of the GST Administrations, under chairpersonship of the Revenue Secretary, is periodically held and attended by the officers of Centre, States, Union Territories, GST Council Secretariat and GSTN to sort out issues related to co-ordination and any specific grievance.
- iv. A State level co-ordination committee comprising of Zonal Chief Commissioner and the State Commissioner has been created for resolution of grievances etc.
- v. Refund process in GST has been made fully electronic with the process of filing, processing and sanction of refund done electronically.
- vi. In case of refund with payment of IGST route, refund disbursed from Customs Authority and is  fully  automated  whereas by route of refund of accumulated ITC, refund is application based and is disbursed in a time bound manner (within 60 days).
- vii. To  ensure  that  refunds  are  processed  and  disbursed  timely,  field  formations  have  been directed to process and pass the final sanction order in FORM RFD-06 and the payment order in FORM RFD-05 within 45 days so that the amount is credited to taxpayer's account within 60 days as stipulated in the Law.
- viii. Whenever, there  is  a  delay  in  sanctioning  refunds  Section  56  of  the  Central  Goods  and Services  Tax,  2017  read  with  notification  No.  13/2017-Central  Tax  dated  28.06.2017, provides for an interest at the rate of 6% on delayed payment of refund beyond a period of 60 days from the date of filing of the refund application.

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## Various measures taken for increasing access to credit for MSMEs in an affordable manner:

- i. Specific  targets  for  lending  to  MSME  sector  have  been  prescribed  in  Priority  Sector guidelines of RBI.
- ii. Scheduled Commercial Banks (SCBs have been mandated not to accept collateral for loans upto ₹10 lakh extended to MSME sector.
- iii. Pradhan  Mantri  Mudra  Yojana  (PMMY)  scheme  launched  in  April,  2015  to  provide collateral  free  access  to  institutional  finance  to  unfunded  Micro/Small  business units, for income generating activities in the manufacturing, trading and service sectors and also for activities allied to agriculture, including homestays. Recently, the eligible loan amount under the scheme has been doubled to ₹20 lakh.
- iv. Computation of working capital requirements of MSE units to be done by banks on the basis of  simplified  method  of  minimum  20%  of  the  projected  annual  turnover  of  the  unit  for borrowal limits up to ₹5 crore.
- v. Streamlining  flow  of  credit  to  Micro  and  Small  Enterprises  for  facilitating  timely  and adequate credit flow during their 'Life Cycle'.
- vi. Banks have been advised that timelines for loans up to ₹25 lakh in units in MSE sector shall not be more than 14 working days.
- vii. Trade Receivables Discounting System (TReDS) has been operationalized to address the problem of delayed payments to MSMEs.
- viii. For better transmission of monetary policy, RBI has advised banks to link all new floating rate loans to external benchmark for MSEs from 01.10.2019 and Medium enterprises from 01.04.2020.
- ix. RBI  has  facilitated  the  Account  Aggregator  (AA)  framework  under  which  information related to financial assets of a customer is collected from the holders of such information (Financial  Information  Providers)  and  is  presented  to  the  customers  or  specified  users (Financial Information Users) to enable faster processing of loan applications.
- x. RBI  has  developed  Unified  Lending  Interface  (ULI)  previously  known  as  Public  tech platform for frictionless credit (PTPFC) which is set to transform the lending landscape in India by making credit more accessible to underserved populations such as small businesses by reducing documentation requirements and simplifying the loan application process.
- xi. As announced in the Union Budget 2024-25, Union Finance Minister had launched the New Credit Assessment Model for MSMEs on 6 th March, 2025. The model leverages the digitally fetched and verifiable data and devises automated journeys for MSME Loan appraisal using objective decisioning for all loan applications and model-based limit assessment for both Existing to Bank (ETB) as well as New to Bank (NTB) MSME borrowers. The benefits to MSMEs by use of this model include submission  of application  from  anywhere through online  mode,  reduced  paperwork  and  branch  visit,  instant  in-principle  sanction  through digital mode, seamless processing of credit proposals, reduced TAT, credit decision based on objective data/ transactional behaviour among others.
- xii. Various credit  guarantee schemes to support credit flow to MSME sector such as Credit Guarantee  Fund  for  Micro  Units  (CGFMU),  Credit  Guarantee  Fund  for  Stand-Up  India (CGFSI), Credit Guarantee Scheme for Startups (CGSS) etc. have been launched.
- xiii. Mutual  Credit  Guarantee  Scheme  for  MSMEs  (MCGS-  MSME)  has  been  launched  for providing 60% guarantee coverage for credit facility upto ₹100 crore sanctioned to eligible MSMEs under the scheme for purchase of equipment / machinery.
- xiv. With regard to the matter of 'easy disbursement of loans,' banks have various schemes for financing based  on  the  GST  returns filed by  the customers  which  enables  faster sanction/disbursement of loans.