Credit Enhancement Guarantee Scheme for Scheduled Castes

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“Credit Enhancement Guarantee Scheme for Scheduled Castes” (CEGSSC) was announced in the Union Budget of 2014-15 under the social sector initiatives of Ministry of Social Justice & Empowerment (MoSJE), Government of India (GoI). The CEGSSC scheme was started with initial corpus of Rs. 200 crores.

The objective of the Scheme is to promote entrepreneurship amongst the Scheduled Castes entrepreneurs by providing Credit Enhancement Guarantee to Member Lending Institutions (MLIs) who shall be providing financial assistance to SC entrepreneurs. IFCI Ltd is the Nodal Agency for implementation of the Scheme for issuing the guarantee to the MLIs, who are encouraged to finance Scheduled Caste entrepreneurs. Under the Scheme, Individuals, Sole Proprietorship, Registered companies, Partnerships & Societies belonging to Scheduled Castes can avail the benefit of the scheme through MLIs for availing Term Loan/Composite Term Loan/ Working Capital facility.


 Salient Features of the scheme

  • Entities promoted by SC entrepreneurs can avail loans from banks/MLIs starting from Rs.15 lakhs to more than Rs.5 crore.
  • Banks/MLIs can avail guarantee under CEGSSC scheme upto a maximum of Rs.5 crore.
  • For loans availed from Rs.15 lakhs to Rs. 1 crore, 100% guarantee cover shall be available to Banks/MLIs.
  • For loans availed from Rs.1 crore to Rs. 2 crore, 80% guarantee cover shall be available to Banks/MLIs.
  • For loans availed from Rs.2 crore to Rs. 5 crore, 70% guarantee cover shall be available to Banks/MLIs.
  • For loans availed above Rs. 5 crore, 60% guarantee cover shall be available to Banks/MLIs, upto maximum guarantee cover of Rs. 5 crore.
  • SC entrepreneurs or entities promoted by them have to approach a branch of MLIs/Banks in their area for availing loans. In turn, MLIs/Banks can avail the guarantee under CEGSSC scheme.


Eligibility to avail the benefit of guarantee cover

  • Registered Companies, Societies
  • Registered Partnerships Firms
  •  Sole Proprietorship firms
  • Individual SC Entrepreneurs
  • Companies/Societies/firms must have more than 51% shareholding by Scheduled Caste entrepreneurs/promoters/members with management control with minimum 6 months existence.
  • Guarantees is issued to Member Lending Institutions (MLIs) for financial assistance extended viz. Term Loan or Composite Term Loan / Working Capital Facility.
  • The Loans shall be covered by Assets created from Loan, and pledge of promoters’ shareholdings in the assisted company/firm/society.
  • No collateral security is required for availing loans from Banks under the scheme.


Guarantee period

Maximum 7 years or repayment period whichever is earlier. However, initially the loan shall be guaranteed for 1 year and renewed at yearly intervals.


FeesPayable for guarantee cover

  • An annual renewal fee shall be payable by Banks/MLIs ranging between 0.20% p.a. 0.75% p.a. depending upon loan amount and at time of renewal.
  • For SC women and SC divyang entrepreneurs, the fees ranges from 0.10% p.a. 0.50% p.a. depending upon loan amount and at time of renewal.


Member Lending Institutions (MLIs)/ Banks

  • State Bank of India, Mumbai
  • Bank of Baroda, Mumbai
  • Union Bank of India, Mumbai
  • Bank of Maharashtra, Pune
  • IDBI Bank, Mumbai
  • Punjab National Bank, New Delhi
  • Bank of India, Mumbai
  • Indian Bank, Chennai
  • Central Bank of India, Mumbai
  • Canara Bank, Bengaluru
  • Punjab & Sind Bank, New Delhi
  • UCO Bank, Kolkatta
  • Indian Overseas Bank, Chennai
  • Karnataka Bank, Mangalore
  • Dhanlaxmi Bank, Thrissur
  • Pallavan Grama Bank, Salem (now Tamil nadu Grama Bank)
  • Sarva Harya Gramin Bank, Rohtak, Haryana


As on 31.1.2024, on cumulative basis, 66 entities promoted by SC entrepreneurs have been sanctioned guarantee cover of approx. Rs.72 crore against bank loan of approx. Rs. 109 crore across India. Through CEGSSC, approx. 4049 number of direct and indirect employments have been generated which includes direct employees, workers, suppliers, vendors, other support services etc.



Source PIB