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Annual Guarantee Fee (AGF)

Guarantee cover extended by CGTMSE for loans sanctioned on or after January 01, 2013 in respect of any specific borrower shall be valid provided the MLI concerned pays an Annual Guarantee Fee (AGF).

The demand on MLIs for Annual Guarantee Fee (AGF) in respect of fresh guarantees would be raised upon approval of guarantee cover. The AGF / guarantee cover would be valid for one year from the material date i.e. Guarantee start date. In the subsequent financial year in the month of April, demand for AGF (i.e. for 2nd AGF) would be raised for the guarantees approved in the previous financial year (till March 31st) for which the AGF has been received till March 31. Such demand would be w.e.f. the date on which previous AGF is expiring till March 31 of that year. The AGF demands for subsequent years would be on "Full Financial Year basis" excepting for the terminal year of guarantee where AGF demand would be till validity of guarantee cover.

Composite all-in Guarantee Fee as under:-




Credit Facility

Annual Guarantee Fee (AGF) [% p.a.]

Women, Micro Enterprises and units in North East Region (incl. Sikkim)

Others

Upto Rs.5 lakh

0.75

1.00

Above Rs.5 lakh and upto Rs.200 lakh

0.85

1.00

Such AGF is to be paid by the MLI on or before two months from the demand date. The Trust reserves the right to revise the annual fee from time to time.

Annual Service Fee (ASF)

Guarantee cover extended by CGTMSE for loans sanctioned prior to January 01, 2013 in respect of any specific borrower shall be valid provided the MLI concerned pays an Annual Service Fee (ASF) of 0.50% on the amount guaranteed for credit facilities upto Rs.5 lakh and 0.75% on the amount guaranteed for credit facilities beyond Rs.5 lakh and upto Rs.100 lakh.

Cost to the borrower

The Credit Guarantee Scheme leaves it to the discretion of the MLIs to decide about passing on the incidence of Annual Guarantee Fee (AGF) to the borrower or alternatively they may decide to bear it themselves.  

Interest rate payable by borrower

Any credit facility which has been sanctioned by the lending institution (all scheduled commercial banks, selected financial institutions & NBFCs) with the maximum interest rate not more than 14% p.a. including cost of guarantee cover

 

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