Call Us Now

+91 9606900005 / 04

For Enquiry

legacyiasacademy@gmail.com

PARTIAL CREDIT GUARANTEE SCHEME (PCGS) 2.0

Focus: GS-III Indian Economy

Why in news?

Partial Credit Guarantee Scheme (PCGS) 2.0 is extended with greater flexibility to respond to emerging demands.

Partial Credit Guarantee Scheme (PCGS) 2.0

  • As part of Aatmanirbhar Bharat Abhiyan, announced by the Government, Partial Credit Guarantee Scheme (PCGS) 2.0 was launched.
  • Under the scheme, provide Portfolio Guarantee for purchase of Bonds or Commercial Papers (CPs) with a rating of AA and below issued by NBFCs/HFCs/ MFIs by Public Sector Banks (PSBs) i.e., Under the scheme – any PSB can purchase securities (minimum rating of ‘AA’) of financially-sound non-banking finance companies.
  • The objective is to address temporary asset-liability mismatches of otherwise solvent NBFCs/Housing finance companies (HFCs) without having to resort to distress sale of their assets to meet their commitments.
  • The government will provide a one-time, six months’ partial credit guarantee to public sector banks for first loss of up to 10%.
  • Also, these NBFCs/HFCs are mandated that the CRAR (Capital to Risk-Weighted Assets Ratio) shall not go below the regulatory minimum while exercising of the option to buy back the assets.
Download PDF
October 2022
MTWTFSS
 12
3456789
10111213141516
17181920212223
24252627282930
31 
Categories