(MENAFN- KNN India) Banks violate norms on collateral security: Vizag MSMEs
Vijayawada, Jan 19 (KNN) Many MSMEs are not aware that loans of upto Rs 10 lakh does not require any collateral security, said Project Manager A.V. Ramakrishna Rao, Credit Facilitation Bureau (CFB).
An awareness meeting has been organised by the Andhra Pradesh Chambers of Commerce and Industry Federation here on Wednesday, in which one of the key complaints that figured out was violation of the Reserve Bank of India (RBI) guidelines on collateral free loans for micro, small and medium enterprises (MSMEs).
During the course of awareness meeting, major issue came out of the discussion that most of the people are not aware that loans of up to Rs.10 lakh did not require any collateral security.
According to the Industry associations' representatives presented, there is a need of some policy to avail funds at low interest rate to the MSMEs. They also pointed out non-acceptance of agricultural land as collateral security and poor implementation of the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme.
Rao from Nabcons (Nabard Consultancy Services) Credit Facilitation Bureau (Nabcons CFB) said the bankers were insisting on collateral security though it was not required for loans of up to Rs.10 lakh.
Project manager said that these issues are taken up periodically by the government with the banks to achieve the desired results.
Chambers president Muthavarapu Muralikrishna and general secretary P. Bhaskara Rao were also addressed during the meeting. (KNN)
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