The Presidents/Chief Executives,
All Banks/DFIs

Dear Sirs/Madam,

 

PRUDENTIAL REGULATIONS – “CLEAN EXPOSURE” UNDER
PRUDENTIAL REGULATIONS FOR CONSUMER AND SME FINANCING

Please refer to the Prudential Regulations for SME and Consumer Financing issued vide BPD circular No 35 of 2003.

2. The clean exposure to an SME entity, allowed under Prudential Regulations for SME Financing, will not include the clean consumer financing limits (Credit Card and Personal Loans etc.), allowed to the sponsors of the said SME under Prudential Regulations for Consumer Financing. However, the banks/DFIs’ aggregate exposure on account of different clean facilities under the three heads of Corporate, SMEs and Consumer Financing will not exceed equity of the bank/DFI.

3. Other instructions on the subject will, however, remain unchanged.

4. Please acknowledge receipt