The Reserve Bank of India vide circular dated 1 July, 2020, has allowed banks to consider the funds infused by the promoters in their MSME units through loans availed under the distressed assets fund as equity.
The Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) vide circular dated June 24, 2020 has introduced the Distressed Assets Fund backed by a guarantee from CGTMSE. RBI has decided to permit the banks to reckon the funds infused by the promoters in their MSME units through loans availed under the captioned scheme as equity/quasi equity from the promoters for debt-equity computation.
Click here to read the circular.
