CGTMSE/(44)/ November 10, 2016



All Member Lending Institutions of CGTMSE

Circular No.117/2016-17

Dear Sir/Madam,

Modifications in guarantee application form with regard to credit facilities covered/proposed to be
covered under PMMY/MUDRA Guarantee Scheme

As you may be aware, many of the credit facilities upto 10 lakh to Micro Enterprises which are eligible for coverage under the Credit Guarantee Scheme (CGS) of CGTMSE can now also be covered under Prime Minister Mudra Yojana (PMMY)/MUDRA guarantee scheme through NCGTC Ltd. To avoid dual guarantee for the same credit facility/overlap for loans upto 10 lakh to Micro Enterprises, the MLIs will have to confirm that the said credit facility has not been covered under MUDRA guarantee Scheme while applying for the guarantee cover for such proposals to CGTMSE

It is clarified that in case of enhancement in credit facilities in working capital type of assistance exceeding 10 lakh, where the guarantee cover for the initial credit facility upto 10 lakh might have been obtained from NCGTC Ltd., the MLI could switch to the guarantee cover under the CGS under CGTMSE provided the MLI approaches for the entire facility i.e. existing coverage plus proposed enhancement after closing the credit guarantee cover under NCGTC guarantee scheme. Here, date of enhancement will be taken as sanction date for entire credit facility to be covered under CGS and the existing guidelines of CGS pertaining to timeframe for submission of application for coverage will apply. In case of additional credit facility to a borrower covered under PMMY/MUDRA over and above 10 lakh, MLI is allowed to apply any additional credit facility under CGS.

Please note that the credit facilities eligible for coverage as per extant guidelines of CGTMSE would only be provided guarantee cover.

Kindly bring the contents of this circular to the notice of all your offices.

                                                                                                                                  
Yours faithfully,

(S.S.Bakshee)
General Manager