**Executive Summary**
This document is a response to an unstarred question in the Lok Sabha concerning MSMEs in the Peddapalli Lok Sabha Constituency, to be answered on January 29, 2026. It details the enhanced Credit Guarantee Scheme (CGS) and its impact, including the approval of guarantees, the rollout of customized credit cards, and measures to reduce guarantee fees. The response includes data up to December 31, 2025, regarding guarantee approvals.
**Key Points / Main Content**
* **Enhanced Credit Guarantee Scheme (CGS)**
* Credit guarantee cover increased from Rs. 5 crore to Rs. 10 crore for MSEs, aligning with the Union Budget 2025-26.
* 1,778 guarantees amounting to Rs. 12,498 crore approved for MSEs in the Rs. 5 crore to Rs. 10 crore slab up to 31.12.2025, including 1 guarantee of Rs. 5 crore in Peddapalli.
* 468 guarantees amounting to Rs. 50 crore approved for MSEs in the Peddapalli district from January to July 2025.
* **Sector-wise Guarantee Approvals in Peddapalli Lok Sabha Constituency (as of Dec 31, 2025)**
* Manufacturing: 310 guarantees approved, amounting to Rs. 106 crore.
* Service: 913 guarantees approved, amounting to Rs. 68 crore.
* Trade: 1,097 guarantees approved, amounting to Rs. 87 crore.
* **Customized Credit Cards**
* Introduction of customized credit cards with a Rs. 5 lakh limit for Micro Enterprises registered on the Udyam portal.
* Targeting 10 lakh credit cards in the first year, in line with the Union Budget 2025-26.
* **Revamped Credit Guarantee Scheme (CGS)**
* Rs. 9,000 crore corpus infusion into CGTMSE.
* Standard Rate of Annual Guarantee Fee (AGF) reduced by 50%, to as low as 0.37% per annum.
* AGF further rationalized for guarantees above Rs. 1 crore, effective from 01.04.2025.
* Technology leveraged for easy online submission, automated processes, and API integration.
**Impact Analysis**
**Micro and Small Enterprises (MSEs)**
* **Impact:** Enhanced access to credit through increased guarantee cover and simplified processes.
* **Action Required:** Register on Udyam portal to avail credit cards. Submit applications online for guarantee coverage.
**Department of Financial Services**
* **Impact:** Responsible for the introduction and monitoring of customized credit cards for micro-enterprises.
* **Action Required:** Continue to monitor the rollout of the credit card scheme and its impact.
**Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)**
* **Impact:** Oversees the revamped CGS and leverages technology for improved processes.
* **Action Required:** Implement digital platforms, automated processes, and API integrations to streamline guarantee approvals.
Key Entities Referenced
Credit Guarantee Scheme (CGS): A scheme to enhance credit access for Micro and Small Enterprises (MSEs) by providing guarantee cover for loans.
Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE): The trust that implements the Credit Guarantee Scheme (CGS) for Micro and Small Enterprises (MSEs).
Peddapalli Lok Sabha Constituency: The specific geographic area to which the policy and question are directly applicable.
Ministry of Micro, Small and Medium Enterprises: The central ministry responsible for policies related to MSMEs.
Union Budget 2025-26: The national budget in which the enhancement of credit guarantee cover was announced, impacting MSMEs.
GOVERNMENT OF INDIA
MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES
LOK SABHA
UNSTARRED QUESTION NO. 152
TO BE ANSWERED ON 29.01.2026
MSMEs IN PEDDAPALLI LOK SABHA CONSTITUENCY
152. SHRI VAMSI KRISHNA GADDAM:
Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:
(a) the details of 1.5 lakh crore additional credit unlocked through enhanced Credit Guarantee
cover from 5 crore to 10 crore announced in Budget 2025-26, specifically for Micro, Small and
Medium Enterprises (MSMEs) in Peddapalli Lok Sabha Constituency;
(b) the number of micro and small enterprises in Peddapalli district that have applied for
guarantee cover under the revised Credit Guarantee Fund Trust for Micro and Small Enterprises
(CGTMSE) scheme during January to July 2025;
(c) the distribution of guaranteed loans sanctioned for MSMEs in Peddapalli Lok Sabha
Constituency, particularly for coal ancillary industries and thermal power equipment
manufacturing units, sector-wise;
(d) the timeline for rollout of customised credit cards with Rupees 5 lakh limit targeting 10
lakh MSMEs, including a coverage plan for registered enterprises in Peddapalli district; and
(e) the measures taken to reduce guarantee fees and streamline the application process for
MSMEs in Peddapalli Lok Sabha Constituency under the enhanced scheme?
ANSWER
MINISTER OF STATE FOR MICRO, SMALL AND MEDIUM ENTERPRISES
(SUSHRI SHOBHA KARANDLAJE)
(a): In order to improve access to credit, the credit guarantee cover has been enhanced for
Micro and Small Enterprises (MSEs), from Rs. 5 crore to Rs. 10 crore under Credit Guarantee
Scheme (CGS) for MSEs in line with the Union Budget 2025-26. As a result, a total of 1,778
guarantees amounting to Rs. 12,498 crore have been approved to MSEs in the slab of Rs. 5 crore to
Rs. 10 crore in the FY 2025-26 till 31.12.2025, out of which 1 guarantee amounting to Rs. 5 crore
has been approved in the Peddapalli district.
(b): A total of 468 guarantees amounting to Rs. 50 crore have been approved to MSEs under
CGS for MSEs during January to July 2025 in the Peddapalli district.
(c): Details of guarantees approved under CGS for MSEs, sector-wise in the Peddapalli Lok
Sabha Constituency are as below:: 2 :
CGTMSE - Guarantee Approved - Cumulative since inception as on Dec 31, 2025
Manufacturing Service Trade
No. of Amount of No. of Amount of No. of Amount of
Guarantees guarantees Guarantees guarantees Guarantees guarantees
District Approved Approved Approved Approved Approved Approved in
in Rs. in Rs. Rs. Crore
Crore Crore
Mancherial 438 61 995 73 1,042 79
Jagitial 457 152 1,006 79 1,625 75
Peddapalli 310 106 913 68 1,097 87
(d): As informed by Department of Financial Service, introduction of customized Credit Cards
with Rs.5 lakh limit for Micro Enterprises registered on Udyam portal, targeting 10 lakh credit
cards in the first year, in line with the Union Budget 2025-26 has been taken up.
(e): CGS was revamped from 01.04.2023, following a corpus infusion of Rs. 9,000 crore into
CGTMSE. As part of the revamp, the Standard Rate of the Annual Guarantee Fee (AGF) was
reduced by 50%, to as low as 0.37% per annum. AGF has been further rationalised for guarantees
above Rs. 1 crore, effective from 01.04.2025. CGTMSE has leveraged technology through digital
platforms, enabling easy online submission of application for guarantee coverage, automated
processes for quicker guarantee approvals and API integration with MLIs for seamless data flow to
the CGTMSE platform.
*****