Module: General Practice
Q67: Scenario: A bank manager demands a "Third Party Guarantee" for a ₹18 lakh loan applied under the "Tarun Plus" category of the Mudra (PMMY) scheme.
Question: As per RBI and CGFMU guidelines, is this demand valid?
✅ Correct Answer: C
Loans under the Pradhan Mantri Mudra Yojana (PMMY) are strictly collateral-free.
When the loan limit was raised to ₹20 Lakh (Tarun Plus) in late 2024, the Credit Guarantee Fund for Micro Units (CGFMU) cover was also extended to ₹20 Lakh.
This implies that banks cannot ask for collateral or guarantees because the government (via CGFMU) is already providing the guarantee.
When the loan limit was raised to ₹20 Lakh (Tarun Plus) in late 2024, the Credit Guarantee Fund for Micro Units (CGFMU) cover was also extended to ₹20 Lakh.
This implies that banks cannot ask for collateral or guarantees because the government (via CGFMU) is already providing the guarantee.