Aug. 14, 2019

Government of India has issued a scheme to provide a one-time partial credit guarantee to PSBs for purchase of pooled assets of financially sound NBFCs.


  • Name of the Scheme: 'Partial Credit Guarantee offered by Government of India (GoI) to Public Sector Banks (PSBs) for purchasing high-rated pooled assets from financially sound Non-Banking Financial Companies (NBFCs)/Housing Finance Companies (HFCs)’.

  • Objective: To address temporary asset liability mismatches of otherwise solvent NBFCs/HFCs without having to resort to distress sale of their assets for meeting their commitments.

  • Validity of the scheme: The window for one-time partial credit guarantee offered by GoI will open from the date of issuance of the Scheme by the Government for a period of 6 months, or till such date by which Rs. 1 lakh crore assets get purchased by banks, whichever is earlier.

  • Eligible NBFCs/HFCs:
    • The NBFCs registered with RBI under the Reserve Bank of India Act, excluding those registered as Micro Finance Institutions and Core Investment Companies.

    • HFCs registered with National Housing Bank (NHB) under the National Housing Bank Act.

    • Micro Finance Institutions and Core Investment Companies are not covered under the Scheme. 


Source : Livemint