Lok Sabha Question No. 1094 (UNSTARRED), answered on 2026-02-05
Subject: Financial facilitation to MSMEs
Ministry: MICRO, SMALL AND MEDIUM ENTERPRISES
Asked by: Shri P V Midhun Reddy

## GOVERNMENT OF INDIA

## MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION NO. 1094 TO BE ANSWERED ON 05.02.2026

## FINANCIAL FACILITATION TO MSMEs

## 1094. SHRI P V MIDHUN REDDY:

Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:

- (a) whether the  Ministry  has  taken  cognizance  of  NITI  Aayog's  finding  that  only  19%  of MSME credit demand was formally met during Financial Year 2021-22, if so, the details thereof;
- (b) whether  reforms  or  expansions  are  planned  for  the  Credit  Guarantee  Fund  Trust  for Micro and Small Enterprises (CGTMSE) to bridge the Rs. 80 lakh crore credit gap if so,  the details thereof; and
- (c) whether there is a proposal to develop state-level financial facilitation cells to improve credit delivery in underserved states, including Andhra Pradesh and if so, the details thereof ?

## ANSWER

## MINISTER OF STATE FOR MICRO, SMALL AND MEDIUM ENTERPRISES (SUSHRI SHOBHA KARANDLAJE)

(a) to (c): The  Government  of  India  has  taken  a  number  of  initiatives  and  measures  to provide  support  to  Micro,  Small  and  Medium  Enterprises  (MSMEs)  for  improving  access  to finance, timely payments and faster technology adoption. Some of them are:

- i. Ministry of  MSME implements Credit Guarantee Scheme (CGS) for Micro and Small Enterprises (MSEs)  through Credit Guarantee Fund  Trust for Micro and Small Enterprises  (CGTMSE)  to  provide  credit  guarantee  for  loans  extended  to  MSEs.  The ceiling for guarantee coverage under the scheme is Rs 10 crore.
- ii. Self-Reliant  India  (SRI)  Fund  has  been  set  up  to  infuse  Rs.  50,000  crore  as  equity funding in MSMEs with a provision of Rs. 10,000 crore from the Government of India and Rs. 40,000 crore through Private Equity/Venture Capital Funds. The Budget 2026-27 has also announced a support of Rs 2000 crore to top up the Self-Reliant India Fund set up  in  2021  to  continue  support  to  micro  enterprises  and  maintain  their  access  to  risk capital.
- iii. Prime  Minister's  Employment Generation Programme  provides  Margin Money subsidy up to 35%, for setting up of new micro enterprises, in the non-farm sector with project cost of Rs. 50 lakh for Manufacturing and Rs. 20 lakh for Service enterprises.
- iv. PM Vishwakarma Scheme was launched  on  17.09.2023 to  provide  end-to-end  holistic support to artisans and craftspeople of 18 traditional trades who work with their hands and  tools.  The  Scheme  includes  provision  of  loans  up  to  Rs.  3  lakh  with  interest subvention of max up to 8%.

To enhance access to credit and expand the scope of Credit Guarantee Scheme (CGS) for Micro and Small Enterprises (MSEs), CGS was revamped from 01.04.2023, following a corpus infusion of Rs. 9,000 crore into Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE). As part of the revamp, the ceiling of guarantee coverage was enhanced from Rs. 2 crore to Rs. 5 crore and the Standard Rate of the Annual Guarantee Fee (AGF) was reduced by 50%, to as low as 0.37% per annum. Further, the Ministry of MSME, Government of India, has enhanced the ceiling of guarantee coverage from Rs.5 crore to Rs.10 crore from 01.04.2025. A total of 9.46 lakh credit guarantees amounting to Rs. 37,229 crore have been extended to MSEs under CGS in the state of Andhra Pradesh since its inception in 2000 till 31.12.2025

To increase credit delivery in the country, including Andhra Pradesh, Ministry of MSME, through its field offices, regularly organizes outreach programmes in coordination with MSME/ Industry  Departments  of  States/UTs  concerned  and  other  stakeholders  like  CGTMSE,  SIDBI, Banks, and MSME Associations etc.

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