New Delhi: Small entrepreneurs in the capital will soon be able to avail bank loans without pledging collateral, as chief minister Rekha Gupta on Tuesday announced a govt-backed credit guarantee scheme offering loans of up to Rs 10 crore. The move follows the signing of a memorandum of understanding (MoU) between Delhi govt and Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) to roll out the Delhi Credit Guarantee Scheme.
Gupta said the initiative would support innovation, job creation and inclusive economic growth in the capital. “Small entrepreneurs often struggle to obtain loans, but the MoU with CGTMSE will offer a permanent solution. This will boost innovation and generate employment on a large scale. Women entrepreneurs, in particular, will gain access to the resources they deserve,” she said in a post on X. Under the scheme, loans of up to Rs 10 crore can be availed without pledging assets. The risk in lending will largely be borne by Delhi govt, encouraging banks to extend credit more readily to small enterprises. Officials said CGTMSE will provide a guarantee cover of 75–90%, while Delhi govt will cover the remaining portion, ensuring that up to 95% of the loan is backed by govt guarantees. This reduces the banks’ exposure to only 5%. Industry minister Manjinder Singh Sirsa, who attended the MoU signing, described the initiative as a “game-changer” for Delhi’s micro, small and medium enterprise (MSME) sector. “For decades, small entrepreneurs — especially women — have faced excessive paperwork and collateral demands. This reform will unlock growth for nearly one million MSMEs in Delhi,” he said. The scheme will cover a wide range of sectors, including manufacturing, services, retail, education and skill development. A dedicated Rs 50 crore fund has been created for the programme. With a leverage potential of nearly Rs 2,500 crore, banks will be able to extend significantly higher credit, and the corpus may be increased in the future. Gupta said the scheme was designed with a leverage ratio of 50:1, enabling an investment of Rs 2 crore to facilitate loans worth up to Rs 100 crore. An NPA ceiling of 10% has been set to limit fiscal risk. The govt initially aims to reach one lakh beneficiaries, though CGTMSE clarified that there will be no cap. Any eligible entrepreneur who meets the criteria will be able to access the credit guarantee. Gupta said the move would help build a stronger and more resilient micro and small enterprise ecosystem in Delhi. “A developed India begins with a developed Delhi, and empowering entrepreneurs is central to that vision,” she added.
