July 05, 2005

All Member Lending Institutions (MLIs) of CGTSI (excluding Public Sector Banks)

Circular No. 25 / 2005-06

Dear Sir / Madam,

Eligibility of REGP Scheme of KVIC under Credit Guarantee Fund Scheme for Small Industries (CGFSI)

CGTSI has been receiving queries from some of the member - banks regarding the eligibility of credit facilities extended by them to the SSI borrowers under Rural Employment Generation Programme (REGP) Scheme of KVIC under the Guarantee scheme of CGTSI. In this connection, we advise that any credit facility (upto Rs.25 lakh) extended by the member- banks without taking any collateral security / third party guarantee to eligible SSI / tiny units including IT/Software Industry and SSSBEs (IR) is eligible for guarantee cover under CGFSI subject to satisfaction of terms and conditions under the Scheme. Accordingly, the member-banks may lodge the applications under CGFSI involving credit facilities extended under KVIC's REGP scheme and seek the guarantee cover for the loan component (net of subsidy / margin money contribution).

It may be reiterated that the member - banks should ensure that all terms and conditions stipulated under the CGFSI are fully satisfied, prior to lodging these applications. It is expected that with this clarification member - banks, especially those who were earlier not doing so, will cover REGP cases of KVIC under CGFSI and enhance availment.

Please feel free to get in touch with us in case any further clarifications are required.

Thanking you,


Yours faithfully,


(S N Sadhwani )

Deputy General Manager