Knowing your Partner Bank
- Applicant MSME approaches partner bank under the scheme and applies for a MSME loan.
Submitting your Application
- Application is submitted as normal business loan application with business proposal and standard requirements for a loan at the partner bank.
- Download MSME Business Loan Guarantee Scheme.
- Contact the BCD Division for more information.
Further Information
Applicants must not go directly to the central bank to get an application for nomination under the scheme. The application must be launched by the participating partner bank on your behalf.
- The Pan Oceanic Bank (POB) is a partner bank under the scheme. The bank handles its services to MSMEs through its SME Banking Service.
o Partner bank appraises loan application
o If application satisfactory but collateral insufficient, partner bank applies to CBSI for application to be covered under guarantee scheme.
o Nomination
o Applicant cannot apply directly to the CBSI. Partner bank after carrying out due diligence will be the authority to nominate applicant’s application to be covered under the guarantee scheme.
- Contact the BCD Division for more information
- Contact the CBSI
- Contact the POB
o Further information
o The participating partner bank will assess the loan application you submitted by looking at the viability of the project, the level of competency which you can undertake the business, your commitment to the project (money and assets that could be counted as security for the loan). If the bank appraises the application is viable under its normal loan assessment criteria and wants to approve the loan but find that you lack the security needed for the loan, then the bank will nominate the loan to be covered under the scheme.
o Partner bank sends nomination to CBSI
o If partner bank is satisfied that applicant is entitled to be guaranteed by the scheme, but lacks the security needed for the loan, the partner bank will apply to the CBSI for the scheme guarantee.
o CBSI assesses nomination and issues guarantee
If CBSI is satisfied, guarantee will be given and partner bank will notify applicant of the outcome.
- Contact the BCD Division for more information
- Contact the CBSI
- Contact the POB
o Further information
o The scheme will guarantee 90% of the unsecured portion of a bank loan. Please contact the partner bank for maximum guarantee amount. For example, if you make a proposal to a partner bank to borrow $50,000 and have asset(s) which the bank accepts as security for $30,000, the unsecured portion of the loan is $20,000. If the partner bank wants the scheme to assist in securing this $20,000, it will apply to CBSI who will guarantee 90% of this amount which is $18,000. The unsecured balance of the loan is 10% or $2,000. This is the risk of the participating partner bank.
§ Download MSME Business Loan Guarantee Scheme
Applicant MSME Notified of Loan Approval
If CBSI is satisfied with a nomination from a partner bank, a guarantee will be given and partner bank will approve loan and notify applicant of the outcome.
Loan Repayment
The maximum term for a loan to be covered under the scheme is five years. Your local bank will monitor and find if you could not complete the full repayment of the loan within the given timeframe the bank will have to make revised plans before the end of five years for the repayment of the loan. The central bank will have discretion to extend the guarantee depending on the circumstances.
Further Information
- The central bank due fee for accessing the scheme is 1% flat of the amount of the loan you applied for. This fee will be collected by your local bank at or before the fund disbursement.
- For loans in default, the bank will apply its usual procedures to call up the loan for rectification or repayment. Where the loan becomes non-performing, the bank should initiate claims supported by a letter from a legal counsel after the loan remains in default for more than 90 days.
