Ref.No.CGTMSE/ (44) /3505 August 24,2016



All the Regional Rural Bank Member Lending Institutions of CGTMSE

Circular No. 114/2016-17

Madam / Dear Sir,

Review of Interest cap and other registration criteria of Regional Rural Banks (RRBs) as Member Lending Institutions (MLIs) of CGTMSE

Please refer to our letter no. CGTMSE/ (44)/892 dated November 03, 2015 (Circular No. 99/2015-16) on the above subject (available on www.cgtmse.in) wherein, inter alia, we had indicated that the Average Base Rate (ABR) applicable to all MLI-RRBs for FY 16-17 shall be advised to you separately. In this connection we advise that the ABR for FY 2016-17 shall be 9.52% p.a. The ABR for FY 2016-17 would be applicable for all loans/credit facilities sanctioned/renewed by MLI - RRBs on or after September 01, 2016 and proposed to be covered under Credit Guarantee Scheme of CGTMSE. The annual interest that can be levied on the loans/ credit facilities sanctioned/renewed by MLI - RRBs and proposed to be covered under CGS of CGTMSE should not therefore be more than 4% p.a. over applicable ABR for F.Y. 2016-17 in which loan/credit facility has been sanctioned to the eligible MSE borrowers. Please note that the ABR of 9.52% p.a. for the FY 2016-17 would remain valid till the ABR for subsequent FY is advised to MLI-RRBs by us.

                                       Please bring the contents of the letter to the notice of all your offices.


Yours faithfully,

Sd/-
(S.S.Bakshee)
General Manager