GoI Extends CGSMFI-2.0 Validity till August 2026

Current Context: On June 10–11, 2026, the Government of India (via the Ministry of Finance) extended the Credit Guarantee Scheme for Microfinance Institutions‑2.0 (CGSMFI‑2.0).

• Validity : Extended till August 31, 2026, or until guarantees worth ₹20,000 crore are issued (earlier deadline: June 30, 2026).
• Loan Limit : Raised from ₹300 crore to ₹1,000 crore for large‑sized Non‑Banking Financial Company – Microfinance Institutions (NBFC‑MFIs) and MFIs, capped at 20% of Assets Under Management (AUM).
• About : Launched on March 20, 2026, the scheme provides credit guarantee cover via the National Credit Guarantee Trustee Company Limited (NCGTC) to banks lending to NBFC‑MFIs/MFIs for on‑lending to small borrowers.
• Progress : Around ₹770 crore loans already sanctioned under the scheme.
• Impact : Ensures better utilisation of the ₹20,000 crore corpus, enhances liquidity for MFIs, and supports small borrowers, Self‑Help Groups (SHGs), and grassroots entrepreneurship.
• Alignment : Strengthens financial inclusion and contributes to Viksit Bharat goals.

Question:

Q.1 Under the Credit Guarantee Scheme for Microfinance Institutions-2.0 (CGSMFI-2.0), the maximum loan limit for large-sized NBFC-MFIs and MFIs has been increased to:
a) ₹500 crore
b) ₹750 crore
c) ₹1,000 crore
d) ₹1,500 crore

Answer: c) The revised framework increased the loan limit from ₹300 crore to ₹1,000 crore.