RBI hikes collateral-free loans for MSEs

Making it mandatory for banks to hike the limit to MSEs, the RBI panel suggested that banks, in turn, can take cover for the collateral free  credit facilities under the credit guarantee scheme (CGS) of the Credit Gurantee Trust for Micro & Small Enterprises.
 
In order to upscale the CGS, the RBI panel in its report released this morning stated that it is necessary to create widespread awareness about the key features and benefits of the scheme.  As the branch level functionaries have a predilection to lend against collaterals, the group recommends that CEOs of banks assume complete and total ownership in the matter of strongly.  “They (CEOs) should be encouraging the branch level functionaries to avail of the CGS cover, including making performance in this regard a criterion in the evaluation of their field staff,” it noted. 

Banks may also strongly encourage their branch level functionaries to avail of the CGS cover, including making performance in this regard a criterion in the evaluation of their field staff, it added.