Government revises norms of Performance in Credit Rating Scheme
Posted on:25 May 2016 14:50:02
25 May 2016 Current Affairs: Government has approved the revision in guidelines of the Performance in Credit Rating Scheme, aiming to increase its credibility and effectiveness for both borrowers and banks.
Under the revised guidelines, the fee to be paid to the rating agencies shall be based on the turnover of the micro and small enterprises which has been categorised into three slabs.
For turnover up to Rs 50 lakh, the fee to be reimbursed by the MSME Ministry will constitute 75 per cent of the fee charged by the rating agency subject to a ceiling Rs 15,000. For turnover between Rs 50 lakh and 2 crore, the fee to be reimbursed will be 75 per cent of the fee charged by the rating agency subject to a ceiling of Rs 30,000.
Similarly, for micro and small enterprises having turnover above Rs 2 crore, the fee to be reimbursed will be 75 per cent of the fee charged by the rating agency subject to a ceiling of Rs 40,000.
Besides, only rating agencies registered by SEBI and empanelled as External Credit Assessment Institution (ECAI) by RBI would be eligible to carry out rating of MSEs under the Scheme.
The eligible rating agency should apply to receive subsidy under the PCR Scheme on the portal of NSIC. Approval for eligible rating agencies should be given within one month.It is expected that the Rating Scheme would encourage MSE sector in improving its contribution to the economy by way of increasing their productivity, since a good rating would enhance their acceptability in the market and also make access to credit quicker and cheaper and thus help in economizing the cost of credit.
The rating agency is also required to complete the rating process within 60 days of the receipt of complete application alongwith prescribed documents. The validity of a rating shall be for a period of one year from the date of issue of the rating letter.Government in March had sought comments from stakeholders on the recommendations of the Committee set up by MSME Ministry for revision in the guidelines of Performance in Credit Rating Scheme. Performance and Credit Rating Scheme is being implemented by Ministry of MSME through National Small Industries Corporation.
FreshersLive - No.1 Job site in India. Fresherslive Current Affairs 2017 section offers informative quiz questions with answers regarding latest current affairs today for all sorts of competitive exams like UPSC, TNPSC , IFS, IAS, IPS, railway exams (RRB) and banking exams like IPBS PO, IPBS clerk, Federal Bank PO, ICICI, SBI, RBI legal officer & Grade officer posts and much more. Register with us to get latest Current Affairs Updates. Also get latest Current Affairs news and quiz Updates for free alerts daily through E-mail