Supreme Court: Imminent Death Not Required For a Statement to Qualify as Dying Declaration  ||  SC: HC Cannot Grant Pre-Arrest Bail Without Quashing FIR; Accused Must Approach Sessions Court First  ||  SC: Agreed Interest Rate Cannot Be Challenged as Exorbitant; Arbitrator Cannot Override Contract  ||  SC: Agreed Interest Rate Cannot Be Challenged as Exorbitant; Arbitrator Cannot Override Contract  ||  SC: GST Exemption on Residential Lease Applies When Building is Sub-Leased for Hostel/PG Use  ||  Rajasthan High Court: Universities Cannot Retain Students’ Original Documents for Pending Fees  ||  NCLT: Damages from Contractual Disputes Cannot Form Basis for Initiating Insolvency Proceedings  ||  Del HC: Pre-SCN Consultation is Unnecessary in Large-Scale GST Fraud Cases with Complex Transactions  ||  Calcutta HC: Unilaterally Appointed Arbitrator Violates Natural Justice and Sets Aside the Award  ||  Raj HC Upholds Padmesh Mishra’s AAG Appointment, Noting Advocacy Skill isn’t Tied to Experience    

RBI releases draft guidelines on Loan System for Delivery of Bank Credit- (Reserve Bank of India) (11 Jun 2018)

MANU/RPRL/0051/2018

Banking

The Reserve Bank of India today released draft guidelines on loan system for delivery of bank credit which stipulate a minimum level of 'loan component' in fund based working capital finance and a mandatory Credit Conversion Factor (CCF) for the undrawn portion of cash credit/ overdraft limits availed by large borrowers, with a view to enhancing credit discipline among large borrowers.

Banks provide working capital finance by way of cash credit/overdraft, working capital demand loan, purchase/discount of bills, bank guarantee, letter of credit, factoring, etc. Cash credit (CC) is by far the most popular mode of working capital financing. While CC has its benefits, it also poses several regulatory challenges such as perpetual roll overs, transmission of liquidity management from the borrowers to banks/RBI, hampering of smooth transmission of monetary policy, etc.

Comments on the draft guidelines are invited from banks and other stakeholders by June 26, 2018. The Comments/Feedback on the draft guidelines may be forwarded to:

The Chief General Manager in-Charge, Reserve Bank of India

Department of Banking Regulation

12th Floor, Main Building

Shahid Bhagat Singh Marg,

Mumbai - 400001

Or by email with subject line "Feedback on draft guidelines on Loan System for Delivery of Bank Credit" on the email.

Tags : GUIDELINES   RELEASE   LOAN SYSTEM  

Share :        

Disclaimer | Copyright 2025 - All Rights Reserved