CGTMSE / ( 44 ) / March 11, 2010
All Member Lending Institutions of CGTMSE
Circular No. 59 / 2009-10
Credit Guarantee Scheme (CGS) -
Modification in procedure for payment of Annual Service Fee (ASF)
It had been observed that due to late payment of ASF dues by Member Lending Institutions (MLIs), there have been instances where the guarantees had lapsed and claims in respect of these accounts had to be declined. In order to ensure that all guaranteed accounts remain valid, major MLIs were requested last year to make a single payment from their Head Office for all their guaranteed accounts before the stipulated time (i.e. May 31st). The experience was found to be satisfactory. Accordingly, it has now been decided to modify the existing procedure for payment of ASF and to make it mandatory for all MLIs to make ASF payments through a single payment from the Head Office of the MLI concerned. The demand for ASF 2010 will be raised in first week of April 2010 and advised to all MLIs both online and through individual letters. Discrepancies, if any, in the ASF amount claimed / received would be reconciled in due course.
2. Regional / Zonal / Circle Offices of MLIs may kindly refer to our Circular No.53/2009-10 dated July 10, 2009 and Circular No.55/2009-10 dated October 20, 2009 regarding closure of guaranteed accounts and arrange to feed the closure details online in respect of the accounts closed during the current FY on or before March 31, 2010 so that ASF 2010 is generated for these accounts on pro-rata basis. All MLIs are requested to extend cooperation in this regard.
3. Please acknowledge receipt.
[P M Radhakrishnan]
Deputy General Manager