CGTMSE/(44)5260

December  16, 2013

 

 

All the Member Lending Institutions of CGTMSE

 

 

Kind Attn.: Head, SME/Priority Sector Dept.

 

Circular No.   70/2013-14

 

Madam / Dear Sir,

 

Modifications to the Credit Guarantee Scheme (CGS) of  CGTMSE

 

            In terms of CGTMSE Circular No. 50/ 2008-09 dated January 07, 2009, the ceiling for coverage under Credit Guarantee Scheme was increased from Rs. 50 lakh to Rs. 100 lakh in respect of eligible credit facilities extended by Scheduled Commercial Banks and select Financial Institutions to eligible borrowers under MSE sector.  It has now been decided to scale down the extent of guarantee cover from 62.50% / 65% (depending on the category of borrower/location of the unit/credit facility) to 50% for loans between Rs. 50 lakh to Rs. 100 lakh irrespective of the category of borrower/location of the unit/credit facility. The Clause 9 (Para 1), Chapter IV of CGS pertaining to the extent of guarantee cover for loans above Rs. 50 lakh to Rs. 100 lakh would stand modified accordingly with the maximum guarantee cover being upto to Rs. 50 lakh. Care may be exercised by MLIs while sanctioning additional loans which bring the overall credit exposure within the above mentioned category. The above modifications will come into effect for the guarantees approved by CGTMSE on or after the date of this circular.

 

The contents of this letter may please be brought to the notice of your all Offices.

 

 

 Yours faithfully,

 

 

Sd/- 

(S.S. Bakshee)

General Manager