CGTMSE/(44)/1236/                                                                             May 12, 2014

 

 

All the Member Lending Institutions of CGTMSE

 

 

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

 

Circular No. 76/2014-15

Dear Sir,

 

Restructured accounts - Relaxations in guidelines

for lodgment of claims by MLIs under CGS

 

As per RBI's revised guidelines on rehabilitation of sick MSE units issued to Banks on November 01, 2012, an account can be treated as sick if it remains NPA for more than 3 months. On finding it viable, banks have to rehabilitate such units.  Since the entire process of identification of such MSE units / assessing the viability for consideration of rehabilitation as per RBI's revised guidelines is going to take time and the unit may not get "Standard status" within the claim period stipulated under Credit Guarantee Scheme by CGTMSE; the Indian Banks' Association (IBA) has requested for exclusion of the period a unit is under rehabilitation from the time for invocation of guarantee by MLI under CGS.

 

IBA has suggested exclusion of the time period from the identification of the MSE unit as sick through rehabilitation process and till the unit is subsequently found non-viable for invocation of guarantee by Member banks under CGS.

 

The issue has been discussed by the Board of CGTMSE, and it has been decided to exclude the time period from the identification of the MSE unit as sick through rehabilitation process and till the unit is subsequently found non-viable for invocation of guarantee and the assumed NPA date for claim purposes would now be taken as the date when the unit is subsequently found non-viable; all other guidelines remaining unchanged. The assumed NPA date may be marked in the CGTMSE Software System by the MLI-SCB and while lodging the claim, the Declaration-Cum-Undertaking must clearly indicate that the proposal was covered under the "RBI Rehabilitation Guidelines for Sick Micro and Small Enterprises" dated November 01, 2012 and indicate the actual NPA date.

 

            The contents of this letter may please be brought to the notice of all your Regional / Zonal / Controlling Offices, who have been allotted Member Ids by CGTMSE.

                                                                                       

 

 Yours faithfully,

 

 

Sd/-

(S.S. Bakshee)

General Manager