Page 45 - Banking Finance February 2021

ARTICLE

CREDIT GUARANTEE

SCHEMES - A TOOL

FOR ECONOMIC AND

SOCIAL UPLIFTMENT

C redit guarantee programmes are designed to segment, the government relooked at expanding the credit

share the lending risk of the lenders and in turn,
guarantee space.
facilitate access to finance for the prospective
borrowers. But India is relatively late entrant to
the world of credit guarantees when compared to other Subsequent to the Central Budget announcements to set up
various credit guarantee funds, The ministry of finance
Asian, European or Latin American countries. Although ECGC established the new credit guarantee super structure called
(Formerly Export Credit Guarantee Corporation of India "NCGTC" (National Credit Guarantee Trustee Company Ltd)
Ltd.), in late 1950s and DICGC (Deposit insurance and credit To uplift the underperforming segments of the economy to
guarantee corporation) in 1960s had started working in the the desired levels. A common trustee company in the name
Indian credit guarantee space. and style of National Credit Guarantee Trustee Company Ltd
as set up by the Department of Financial Services, Ministry
After that it took another 40 years for CGTMSE (Credit of Finance, and Government of India to act as a common
Guarantee Fund Trust for Micro and Small Enterprises) to trustee company to manage and operate various credit
get established in year 2000 focusing Micro and small guarantee trust funds.
borrowers. After realizing the CGTMSE success with respect
to MSE borrower which worked for single guarantee Overview of NCGTC:-

About the author (National Credit Guarantee Trustee Company Ltd)
NCGTC was incorporated under the Indian Companies Act,
Rajesh Ranjan 1956 on March 28, 2014 with a paid-up capital of Rs. 10
Senior Manager (Faculty) crore, with its registered office at MSME Development
Union bank of india, Centre, C-11, G-Block, Bandra Kurla Complex, Bandra [East],
STC -Powai,Mumbai Mumbai-400051.

BANKING FINANCE | FEBRUARY | 2021 | 45