The amended directive has exempted debtors who are utilizing a maximum working capital loan of Rs 30 million under the category ‘manufacturing industries. Previously, such a cap was Rs 10 million.
BFIs can fix the limit of such loans according to their working capital loan policy, however, the types of such loans should align with the guideline.
Similarly, while setting the maximum working capital loan limit for any firm-institution-company which are allowed to take a maximum loan amount of Rs 20 million (in the case of manufacturing industries Rs 40 million) from one or more BFIs, BFIs can set a maximum loan amount not exceeding 20 percent of their estimated annual turnover. Such loan should mature in less than one year with possible renewal.
BFIs should identify permanent working capital need and fluctuating working capital need while analyzing working capital loan requirement when issuing such loans.