Centre Extends CGSMFI-2.0 Till August 31, Boosts Loan Limit For MFIs
The government also approved an increase in the maximum loan amount capped to large-sized NBFC-MFIs/MFIs from Rs 300 crore to Rs 1,000 crore under the overall ceiling of 20 percent of assets under management (AUM).
New Delhi: The government on Wednesday approved the extension of the credit guarantee scheme for microfinance institutions- 2.0 (CGSMFI-2.0) and a hike in the maximum loan limit to Rs 1,000 crore. As of date, loans totalling Rs 770 crore have been sanctioned under the scheme, the Union finance ministry said in an official statement.
The CGSMFI-2.0 scheme was introduced on March 20, 2026, and aims to provide guarantee cover to banks and financial institutions through National Credit Guarantee Trustee Company Limited (NCGTC) against expected losses on the financial assistance extended by them to NBFC-MFIs and MFIs for on-lending to small borrowers.
The scheme was valid till June 30, 2026 or loans up to Rs 20,000 crore are guaranteed, whichever is earlier. “The Government of India has approved extension in validity of the Credit Guarantee Scheme for Microfinance Institutions-2.0 (CGSMFI-2.0) up to August 31, 2026, or till guarantees for an amount of Rs 20,000 crore are issued, whichever is earlier,” the ministry said.
The government also approved an increase in the maximum loan amount capped to large-sized NBFC-MFIs/MFIs from Rs 300 crore to Rs 1,000 crore under the overall ceiling of 20 percent of assets under management (AUM). “The extension in validity and increase in maximum loan amount capped to large-sized NBFC-MFIs/MFIs is expected to result in better utilisation of the scheme and facilitate increased credit flow to the MFI sector,” the ministry added.
