Module: General Practice
Q10: An MSME borrower has a credit facility covered under the Credit Guarantee Scheme (CGS-I) of CGTMSE. The account turns NPA. Based on the guidelines updated as of April 1, 2025, what is the maximum guarantee cover limit available per borrower?
✅ Correct Answer: C
🎯 Quick Answer:
₹10 Crore.Structural Breakdown: Previous Limit: The limit was historically ₹2 Crore, then enhanced to ₹5 Crore.
Current Limit (2025 Update): As per the updated scheme (CGS-I) effective April 01, 2025, the maximum guarantee coverage limit per borrower is ₹10 Crore.
Condition: This applies to the outstanding credit facilities.
Historical Context: The enhancement to ₹10 Crore is intended to accommodate the rising capital requirements of modern MSMEs and encourage banks to lend larger amounts without collateral.