Small businesses to get collateral-freeloans up to ₹10 cr.

Delhi government offers collateral-free loans up to ₹10 crore for small businesses, boosting entrepreneurship and supporting women-led startups.

The Delhi government on Tuesday 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 ₹10 crore to new and existing micro and small enterprises (MSEs).

Terming the initiative a “major boost” for small entrepreneurs, Chief Minister Rekha Gupta said loan guarantees will be jointly shared by the city government and CGTMSE, a Central government entity, under the Delhi Credit Guarantee Scheme.

According to the Chief Minister’s Office (CMO), CGTMSE will provide guarantee cover of 75-90% of the loan amount while the remaining portion will be backed by the Delhi government.

“As a result, up to 95% of loans extended by banks will be government-guaranteed, reducing banks’ exposure to just 5% and encouraging them to lend more confidently to small businesses,” read a statement from the CMO.

The scheme aims to help small entrepreneurs by enabling them to secure loans without providing any collateral or security.

Ms. Gupta said lakhs of youth in Delhi aspire to start ventures in manufacturing, services, and allied sectors, but often struggle due to a lack of financial support. “This initiative will ease access to capital, reduce risks for banks, and improve Delhi’s business environment while promoting innovation, employment generation, and an inclusive urban economy,” she said.