Nod to partial credit guarantee scheme for PSBs

New Delhi: The Union Cabinet gave nod to a partial credit guarantee scheme for public sector banks (PSBs) to purchase high-rated pooled assets from financially sound NBFCs and housing finance companies. PSBs can purchase high-rated pooled assets from financially sound NBFCs/ HFCs, with the amount of overall guarantee provided by government till the first loss of up to 10% of fair value of assets being purchased by banks or Rs 10,000 crore, whichever is lower. It was announced that the government will provide one-time six months' partial credit guarantee to PSBs for first loss of up to 10% for purchase of high-rated pooled assets of financially sound NBFCs, amounting to a total of Rs 1 lakh crore during the current financial year.