{"id":86389,"date":"2019-12-12T15:55:02","date_gmt":"2019-12-12T10:25:02","guid":{"rendered":"http:\/\/factly.forumias.com\/?p=12319"},"modified":"2019-12-12T15:55:02","modified_gmt":"2019-12-12T10:25:02","slug":"cabinet-approves-partial-credit-guarantee-scheme","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/cabinet-approves-partial-credit-guarantee-scheme\/","title":{"rendered":"Cabinet approves Partial Credit Guarantee Scheme"},"content":{"rendered":"\n<p><strong>News:<\/strong>Union Cabinet has approved Partial Credit Guarantee Scheme for purchase of high-rated pooled assets from financially sound NBFCs\/HFCs by Public Sector Banks(PSBs).<br><\/p>\n\n\n\n<p><strong>Facts:<\/strong><br><\/p>\n\n\n\n<p><strong>About the Partial Credit Guarantee Scheme:&nbsp;<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>The scheme provides for a one-time partial credit guarantee to Public sector banks(PSBs) for purchase of pooled assets of financially sound NBFCs and HFCs,<\/li><li>The scheme aims to address temporary asset liability mismatches of otherwise solvent NBFCs\/HFCs without having to resort to distress sale of their assets to meet their commitments.<\/li><li>The scheme would cover NBFCs \/ HFCs that may have slipped into SMA-0 category and asset pools rated BBB+ or higher.<\/li><li>The validity of the scheme offered will be open from the date of issuance of the Scheme by the Government for a period of six months or till such date by which Rupees One lakh crore assets get purchased by banks,whichever is earlier.<\/li><\/ul>\n\n\n\n<p><strong>Significance of the scheme:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>The scheme was launched as the NBFCs including HFCs have been under stress following the series of defaults by group companies of Infrastructure Leasing &amp; Financial Services Ltd. (IL&amp;FS).<\/li><li>This stress on NBFCs was seen as a key reason for a slowdown in the economy.It has also caused reduced credit flow to small businesses and consumers.<\/li><li>Hence,this scheme will help address NBFCs\/HFCs resolve their temporary liquidity and enable them to continue contributing to credit creation and providing last mile lending to borrowers, thereby spurring economic growth.&nbsp;<\/li><\/ul>\n\n\n\n<p><strong>Additional information:<\/strong><br><\/p>\n\n\n\n<p><strong>About Special mention accounts(SMA):<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Special Mention Accounts are those accounts that shows symptoms of bad asset quality in the first 90 days itself.<\/li><li>The Special Mention Account identification is an effort for early stress discovery of bank loans.It was introduced as a corrective action plan to contain stress.<\/li><\/ul>\n\n\n\n<p><strong>Categories of SMA accounts:<\/strong>RBI has classified such Special Mention Accounts accounts into three categories which are:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>SMA-0 is a category in which both the principal and interest has remained outstanding for a period of 30 days after the payment due date and there can be some incipient stress with the loan account.&nbsp;<\/li><li>SMA-1 is a category in which stress with respect to the principal and interest has remained overdue for a period of more than 30 days to 60 days.&nbsp;<\/li><li>SMA-2 is the third category devised in order to mitigate the bad loan problem with the amount being overdue for tenure between 61 days to less than 90 days.<\/li><\/ul>\n","protected":false},"excerpt":{"rendered":"<p>News:Union Cabinet has approved Partial Credit Guarantee Scheme for purchase of high-rated pooled assets from financially sound NBFCs\/HFCs by Public Sector Banks(PSBs). Facts: About the Partial Credit Guarantee Scheme:&nbsp; The scheme provides for a one-time partial credit guarantee to Public sector banks(PSBs) for purchase of pooled assets of financially sound NBFCs and HFCs, The scheme&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/cabinet-approves-partial-credit-guarantee-scheme\/\">Continue reading <span class=\"screen-reader-text\">Cabinet approves Partial Credit Guarantee Scheme<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3127],"tags":[3971],"class_list":["post-86389","post","type-post","status-publish","format-standard","hentry","category-economy","tag-partial-credit-guarantee-scheme","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704933311},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/86389","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=86389"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/86389\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=86389"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=86389"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=86389"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}