DPIIT notifies credit guarantee scheme for startups
By Team Startupcity | Saturday, 08 October 2022, 10:44 IST
The Department for Promotion of Industry and Internal Trade (DPIIT) has notified credit guarantee scheme for startups for providing collateral-free loans. Loan/debt facilities sanctioned to an eligible borrower on or after October 6, would be eligible for coverage under the scheme, according to the notification.
“The central government has approved the 'Credit Guarantee Scheme for Startups (CGSS) for the purpose of providing credit guarantees to loans extended by member institutions (MIs) to finance eligible borrowers being startups,” the DPIIT said.
MIs include financial intermediaries (banks, financial institutions, NBFCs, AIFs) engaged in lending/investing and conforming to the eligibility criteria approved under the scheme. It said that maximum guarantee cover per borrower shall not exceed Rs 10 crore and the credit facility being covered here should not have been covered under any other guarantee scheme.
The government will setup a trust or fund to guarantee payment against default in loans or debt extended to eligible borrowers, managed by the Board of National Credit Guarantee Trustee Company Ltd as the Trustee of the Fund. The department will setup a management committee to oversee the affairs of the trust.
Ease of doing business :The DPIIT, invited suggestions from businesses and citizens on issues in starting and running a business and decriminalisation of minor violation under different provisions/sections.
“The aim is to make ‘New India’ a preferred investment destination across the globe and ensure hassle-free service delivery to the ultimate beneficiary,” it said in a statement.
The broad areas include getting permissions and approval, renewal of certificates and licenses, decriminalisation of minor offences, and applying for and payment incentives. Filings/returns, inspections/audits, online systems/process, maintaining registers and records, and procedural/guidelines related issues are the other subjects.
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