The Credit Guarantee Scheme for Startups provides collateral-free loans to startups through eligible financial institutions. This helps address the reluctance of banks to lend to startups due to perceived risks.

Benefits

• Collateral-free loans with credit guarantees covering up to 75% of the loan amount.
• Applicable for working capital needs or capital expenses.

Eligibility Criteria

• Must be a DPIIT-recognized startup.
• Loans are limited to startups that can demonstrate financial viability and repayment capacity.

How to Apply

1. Approach a participating bank or financial institution offering credit under the CGSS.
2. Submit a loan application along with supporting documents like audited financial statements, a business plan, and tax filings.
3. The financial institution evaluates the application and applies for a guarantee under CGSS.

Business Plan or Obligations Required

• Revenue Projections: Startups must submit clear financial forecasts showcasing their ability to generate revenue and repay the loan.
• Feasibility Study: Include a detailed market study to demonstrate the business potential.
• Obligations: Ensure timely repayment of the loan and compliance with reporting requirements.