RBI prescribes minimum level of ‘loan component’ of 40 per cent for working capital limit of Rs 150 crore and above

  • The Reserve Bank of India in its guidelines has issued that in respect of borrowers having aggregate fund based working capital limit of Rs 150 crore and above, a minimum level of ‘loan component’ of 40 per cent will be effective from April 1, 2019.
  • Drawings in excess of the minimum loan component threshold may be allowed in the form of cash credit facility.
  • The 40 per cent loan component will be revised to 60 per cent, with effect from July 1, 2019.