Government Unveils CGSMFI 2.0 to Strengthen Microfinance Lending Ecosystem
The scheme introduces a tiered guarantee structure: small MFIs receive an 80% guarantee, medium MFIs receive 75%, and large MFIs are covered at 70%.
Strict interest rate caps have been implemented, requiring Banks to lend to MFIs at EBLR/MCLR plus 2%, while MFIs must lend to borrowers at a rate 1% lower than the average lending rate of the previous six months.
The National Credit Guarantee Trustee Company (NCGTC) under the Ministry of Finance will manage the implementation, with a total guarantee limit of ₹20,000 crore or a validity until June 30, 2026.
For aspirants, this scheme is significant as it highlights the government's push for financial inclusion and risk mitigation in the volatile micro-lending sector.
Key Facts / Static GK
EBLR: External Benchmark Lending Rate
MCLR: Marginal Cost of Funds Based Lending Rate
Department of Financial Services falls under the Ministry of Finance
Practice Quiz — 26 March 2026
Q1. Under the CGSMFI 2.0 scheme, what is the specific guarantee percentage provided for small Microfinance Institutions (MFIs)?
Q2. The newly established pilot plant at ARCI Hyderabad focuses on the production of which specific type of magnets?
Q3. Consider the following statements regarding the RRU-SSB MoU: 1. The MoU was signed in New Delhi. 2. RRU will provide academic accreditation to SSB training programs. 3. The goal is to align training only with vocational certificates, not degrees. Which of the statements is/are correct?
Q4. Which mobile application will serve as the initial platform for the voice-based commerce pilot project launched by Razorpay and Sarvam AI?
Q5. The Standing Committee of the National Board for Wildlife (SC-NBWL), which oversaw the FSI-BISAG-N MoU, is a statutory body under which act?
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