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Credit Monitoring Arrangements (CMA)

The Credit Authorisation Scheme (CAS) for StCBs and DCCBs, which was in operation since 1974, was replaced by Credit Monitoring Arrangement from April 2000.

Under CMA, cooperative banks are required to consider loan proposals for sanction within the broad framework of policy guidelines issued by RBI/NABARD from time to time and in accordance with the exposure and other prudent banking norms. The exposure norms are fixed based on supervisory rating category of the bank – for individual exposure as fixed amounts, for unit wise exposure as percentage to capital funds and for sector wise exposure as percentage to Internal Lendable Resources. Further, the cooperative banks would have to satisfy themselves about the technical feasibility and financial viability of the proposal, credit worthiness of the borrower, adequacy of margin, security, etc. However, NABARD would continue to review policies, issue instructions and convey approvals, where necessary, for financing Public Distribution System and other purchase/procurement operations of Central/State Governments as also deployment of surplus resources by StCBs/DCCBs.

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