Page 30 - Banking Finance September 2023

ARTICLE

Quantum of Loan and margin money/ Funding mechanism
beneficiary contribution The entire amount of AHIDF of Rs. 15000 cr. will be
disbursed by the Scheduled Bank starting from 2020-
The project under the AHIDF shall be eligible for loan up to
21.
90% of the estimated/ actual project cost from any
Scheduled Bank, National Cooperative Development The Scheduled bank may utilize their available financial
Corporation (NCDC),based on submission of viable projects resources to lend the Eligible Entities.
by eligible beneficiaries. The beneficiary contribution in case
of Micro and Small units as per MSME defined ceiling could Credit Guarantee Cover
be 10% while in case of Medium Enterprises as per defined
A Credit Guarantee fund Trust of Rs. 750 cr. (Rupees
MSME ceiling, beneficiary contribution could go up to 15%.
Seven Hundred Fifty Crore) has been established which
The beneficiary contribution in other categories of
is managed by Nabsanrakshan Trustee Co. Pvt. Ltd., a
enterprises could go up to 25%.
dedicated trust floated by NABARD for the purpose.
Department of Animal Husbandry and Dairying will pay
Interest Subvention and Lending Rate of
Rs. 75 crore per year over 10 years towards Credit
Interest Guarantee at the beginning of each Financial Year.
Interest subvention- Up to 3% per annum for all
The credit guarantee will be provided only for those
Eligible Entities for development of identified animal
projects which are viable and are covered under MSME
husbandry based infrastructure facilities.
defined ceilings and the guarantee coverage would be
Lending Rate of interest- The rate of interest to be up to 25% of the credit facility available to the
fixed by scheduled banks or NCDC asper their existing borrower.
system of interest rate calculation as per the RBI
The Credit Guarantee will not be provided to other
guidelines. However, the rate of interest should not
beneficiaries who are not covered under MSME norms,
exceed at 200 basis points plus External Benchmark
however, those Eligible Entities will be eligible to get
Based Lending Rate (EBLR) or equivalent rates for the
interest subvention.
Eligible Entities whose project cost are falling within
MSME defined ceilings. The Rate of interest to be fixed
Credit Guarantee cover by Credit
by scheduled banks/ lending institutions such as NCDC,
for other projects could be based on commercial Guarantee Fund Trust for Micro and
interest rate of Bank.
Small Enterprises (CGTMSE)
The Department of Animal Husbandry and Dairying will Eligible units may also avail credit guarantee cover from
transfer the interest subvention amount directly to the
CGTMSE scheme for the loan amount up to Rs 2.00 crores
Scheduled Bank. Initially the Department will pay
with the guarantee cover of maximum extent of 85% of loan
interest subvention amount in advance upfront to the
amount.
lending bank for the first year based on the request of
Scheduled Bank. Interest subvention from the 2nd year Repayment
onwards would be released based on the non- NPA
Maximum repayments Period are 8 years inclusive of
borrowers entitlement claimed by the Scheduled Banks
moratorium of 2 years on principal amount. The Scheduled
every year in advance.
Bank shall ensure that maximum re-payment period should
Interest subvention will not be provided to such not exceed 10 years from the date of first disbursement
beneficiaries which are found to be defaulter at any inclusive of moratorium of 2 years on repayment of principal.
point of time for repayment and also the bank is free The interest subvention will be provided only for 8 years
to take any action as per its existing guidelines. No including two years of moratorium. However, the Financing
interest subvention will be provided for the duration an Bank, at their discretion, may curtail the repayment period
account is NPA even if the beneficiary returns to depending on the project magnitude, size of the financial
standard category. investment, repayment capacity of the project.

30 | 2023 | SEPTEMBER | BANKING FINANCE