The government has introduced the Credit Guarantee Scheme for Microfinance Institutions 2.0 (CGSMFI-2.0), a targeted initiative designed to strengthen the microfinance ecosystem and support small borrowers. Effective March 20, 2026, the scheme will remain in force until June 30, 2026, or until guarantees worth Rs 20,000 crore are issued. Under this framework, scheduled commercial banks and all-India financial institutions will provide fundings to NBFC-MFIs and MFIs, which, in turn, will on-lend to small borrowers defined within Reserve Bank of India’s microfinance regulations.