New Delhi, Jan. 31 -- The Delhi government has signed a memorandum of understanding (MoU) with the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) to provide collateral-free loans of up to Rs 10 crore to new and existing micro and small enterprises (MSEs).

Shared Credit Guarantee Model

Under the Delhi Credit Guarantee Scheme, the loan guarantee will be jointly shared by the Delhi government and CGTMSE. CGTMSE will provide a guarantee cover of 75-90 per cent of the loan amount, while the remaining portion will be backed by the Delhi government.

According to the Chief Minister's Office (CMO), this structure will result in government-backed guarantees covering up to 95 per cent of the loan value, reducing lenders' ris...