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20/02/2018 02:28pm

Rebooted CGTMSE allows annual guarantee fee to be charged on Outstanding Loan Amount, CGS to cover retail segment also

image Rebooted CGTMSE allows annual guarantee fee to be charged on Outstanding Loan Amount, CGS to cover retail segment also

New Delhi, Feb 20 (KNN) In an event to Reboot the CGTMSE organized by the Ministry of MSME, CGTMSE and SIDBI, It has been announced that the Annual Guarantee Fee will now on be charged on Outstanding loan amount rather than the sanction loan amount. It has also been decided to expand the Credit Guarantee Scheme (CGS) coverage to cover the MSE Retail Segment as well.

MSME Minister Giriraj Singh, MSME Secretary AK Panda, SIDBI CMD  Mohammad Mustafa, Ram Mohan Mishra, AS & DC (MSME),  Rajeev Kumar, Secretary, Department of Financial Services, Ministry of Finance and CGTMSE CEO Subodh Kumar were present at the event.

The Credit Guarantee Fund Scheme for Micro and Small Enterprises (CGS) was launched by the Government of India (GoI) to make available collateral-free credit to the micro and small enterprise sector.

During the event the key changes, along with a new logo of the trust, several key changes in the CGTMSE were unveiled.

Under the changed rule, loans with Partial Collateral Security have been allowed under CGS.

“This apart from bringing a large chunk of loans under the ambit of credit guarantee =s would also help in promoting disciplined credit behaviour,” said an official release.

It has also been decided to increase the extent of guarantee coverage for proposals above Rs 50 lakh.

New Product for NBFCs have been introduced in order to enable them to avail loan guarantees under the credit guarantee scheme.

It has also been announced to enhance the IT infrastructure of the Trust to improve operational efficiencies and reduce turnaround time for claim settlement.

Further, under the Rebooted CGTMSE, the Trust is embedding risk management tools within the scheme.

The Credit Guarantee Fund Scheme for Micro and Small Enterprises (CGS) was launched by the Government of India (GoI) to make available collateral-free credit to the micro and small enterprise sector.

Both the existing and the new enterprises are eligible to be covered under the scheme.

MoMSME abs SIDBI established a Trust named Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) to implement the Credit Guarantee Fund Scheme for Micro and Small Enterprises. T

he scheme was formally launched on August 30, 2000. The corpus of CGTMSE is being contributed by the GoI and SIDBI in the ratio of 4:1 respectively and has contributed Rs. 2477.78 crore to the corpus of the Trust up to May 31, 2016. As announced in the Package for MSEs, the corpus was to be raised to Rs.2500 crore by the end of 11th Plan. (KNN Bureau)

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