SCHEDULED COMMERCIAL BANKS
All scheduled commercial Banks in public and private sector with 3 years of continuous profit track record, net NPAs not exceeding 3%, minimum net worth of Rs.100 cr. and not less than 9% CRAR.
REGIONAL RURAL BANKS
All restructured RRBs having net NPA within 3% (relaxable in deserving cases), having profitable operations and not carrying any accumulated losses and CRAR >9%.
MFI / SMALL BUSINESS FINANCE COMPANIES/NBFC
- Been in lending to Own Account Enterprises, i.e. micro units with loan size upto Rs.10 lakh for atleast 3 yearsand/or the promoters / management having experience of atleast 10 years in this area.
- Having minimum out reach of 3000 existing borrowers for MFIs.
- Having suitable systems, processes and procedures such as internal accounting, risk management, internal audit,MIS, cash management, etc.
- Meeting the minimum CRAR and other norms stipulated by RBI for MFIs registered as NBFC-MFIs and comply all the prevailing RBI guidelines. For all categories of NBFCs, registration with RBI will be mandatory.
- Should be a member of a Credit Bureau.
- Rating requirement:
- MFIs (including NBFC-MFIs) – minimum Capacity Assessment Rating of mfr5 by CRISIL or its equivalent.
- NBFCs – minimum external rating of BB- for small NBFCs having total portfolio below Rs. 500 crore and BBB+ for NBFCs having portfolio of Rs. 500 crore or more. For small NBFCs not having external credit rating, they should possess satisfactory borrowing arrangements with any Scheduled Commercial Bank for a minimum of 2 years.
- Recovery performance: For MFIs : Portfolio at Risk (i.e. overdue more than 30 days) within 5%. For others – Net NPA not higher than 3%.
- For all MFIs, it will be desirable to have undergone Code of Conduct Assessment (COCA) with a minimum score of 60 or equivalent.
- The assistance will be based on internal credit appraisal process by MUDRA / SIDBI.
- The assistance shall be priced based on risk assessment, geographical distribution, social parameters, etc.
- The Board of MUDRA shall fix prudential ceilings for lending to various categories of borrowers as also limits for individual borrower / borrower group in line with RBI instructions on the subject.
- The detailed terms of assistance shall be laid down in the loan agreement to be executed with the individual intermediary.