Bank Guarantee Charges Reimbursement Scheme

The Ministry of Micro, Small and Medium Enterprises in collaboration with National SC-ST Hub (NSSH) has launched the Bank Guarantee Charges Reimbursement Scheme. The Bank Guarantee Charges Reimbursement Scheme seeks to provide financial assistance against the bank charges paid in obtaining Performance Bank Guarantees (PBG) for SC-ST owned

Micro and Small Enterprises (MSEs). In this article, we look at the Bank Guarantee Charges Reimbursement Scheme in detail. Also, read about Reimbursement of Loan Processing Fee

Objectives of the Scheme

The objective of the Bank Guarantee Charges Reimbursement Scheme are given below:

To enhance marketing capabilities and competitiveness of SC/ST owned Micro and Small Enterprises (MSEs).
To provide a platform for interaction with large institutional buyers.
To update enterprise about the global market scenario.

Eligibility Criteria

Any SC/ST owned MSEs can avail the benefits under the Bank Guarantee Charges Reimbursement Scheme. The following criteria are applicable for recognizing the SC or ST MSEs:
- In case of proprietorship firm, the proprietor must be from SC or ST category.
- In case of Partnership firm, the SC and ST partners should possess at least 51% shares in the enterprise.
- In the case of Private Limited Company, SC or ST entrepreneurs should own at least 51% shares.

Note: It is mandatory to possess Udyog Aadhaar Memorandum (UAM) number,

PAN number and registration under Goods and Services Tax (GST) by the MSEs while applying for the scheme.

Reimbursement of Bank Charges for Performance Bank Guarantee (PBG)

Bank Guarantee Charges Reimbursement Scheme will provide reimbursement to SC/ST owned MSEs on charges paid to the bank for issuance of Performance Bank Guarantee (PBG). The financial assistance under this Scheme will be distributed from National SC/ST Hub (NSSH) funds and would be limited to 50% or Rs.1,00,000 on PBG charges paid (excluding GST and all other applicable taxes). Note: The assistance under the Scheme can be availed multiple times in a financial year by the SC or ST entrepreneurs, but the assistance would be restricted to the maximum ceiling as mentioned above.

Criteria for Financial Institution

The charges paid for Performance Bank Guarantee (PBG) obtained from any Financial Institution in are eligible for reimbursement under the Scheme.

Duration of the Scheme

The Scheme is available till the existence of National Scheduled Caste or Scheduled Tribe Hub (NSSH) scheme or until further orders issued from the Ministry of MSME, whichever is applicable.

Documents Required

The eligible applicant has to submit the below-mentioned documents:

Copy of Udyog Aadhaar Memorandum (UAM) number or Goods and Services Tax (GST).
In case of proprietorship, copy of PAN card of SC/ST proprietor.
Certified copy of Caste Certificate of all promoters
Copy of Partnership Deed for Partnership Firm
In the case of LLP or Private Limited Company, Memorandum and Article of Association are required
Debit statement with PBG charges with Bank Guarantee number and applicant MSE’s name
Copy of PBG issued by the bank
Cancelled Cheque of the current account of the enterprise from which charges have been debited
Proof of amount transferred as reimbursement by NSSHO.
Purchase Order (PO), Supply Order (SO), Work Order from Central Government organization, CPSE, State Government organization against which PBG is taken.

Application Procedure

To apply for the Bank Guarantee Charges Reimbursement Scheme, follow the steps mentioned below:

Submission of Claims Step 1: The applicant can approach the NSSH office for claiming their reimbursement in obtaining Performance Bank Guarantees (PBG). Fill the prescribed application form collected from the nearest NSSH Office (NSSHO).

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Verification by NSSHO Step 2: The verification of the application and documents would be conducted by the respective officer at NSSHO. In case of any discrepancy, clarification would be required from the bank or applicant, respectively. Submission of Documents Step 3: After verification by NSSHO, proposals of all applicants in the prescribed format will be submitted to NSSH at NSIC Head Office for approval. Approval on Reimbursement Step 4: Based on the verification made by the NSSHO, the NSSH cell would forward the application to the Screening Committee under the Ministry of MSME, NSSH Cell and Finance Division of NSIC for consideration. Mode of Payment Step 5: The reimbursement amount would be credited to the applicant’s bank account, where the PBG charges have been debited, directly through the Public Financial Management System (PFMS) by the respective NSSHO or NSSH Cell. Timeline for Submission of Claims The applicant should submit their claims within 45 days from the issuance of Performance Bank Guarantee. On submitting the claim, the NSSH Office will conduct an inspection and accordingly, reimbursement will be released by NSSH office to each applicant with within 45 days from the receipt of application.

Other Conditions

Any SC-ST owned MSE availing reimbursement under this scheme can not avail reimbursement of bank charges on PBG, from any other scheme of Government or private agencies.
Upon submission of the application form and documents does not guarantee the reimbursement under this scheme.

Contact Details

For any queries regarding the scheme, the applicant can contact the NSSH cell at NSIC Bhawan, Head Office, Okhla Industrial Estate, New Delhi or can drop an email.

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Frequently Asked Questions

Common questions about Bank Guarantee Reimbursement Scheme for SC/ST MSEs.

The Bank Guarantee Charges Reimbursement Scheme is a financial assistance program launched by the Ministry of Micro, Small and Medium Enterprises in collaboration with the National SC-ST Hub (NSSH). It aims to provide reimbursement to SC/ST owned Micro and Small Enterprises (MSEs) for the charges paid to banks for obtaining Performance Bank Guarantees (PBG).

Any SC/ST owned MSE can avail the benefits under this scheme. The eligibility criteria include having a proprietorship firm owned by an SC/ST proprietor, a partnership firm where SC/ST partners hold at least 51% shares, or a private limited company where SC/ST entrepreneurs own at least 51% shares. Additionally, the MSE must possess a Udyog Aadhaar Memorandum (UAM) number, PAN number, and registration under Goods and Services Tax (GST).

The Bank Guarantee Charges Reimbursement Scheme will reimburse SC/ST owned MSEs up to 50% or Rs.1,00,000 (whichever is lower) on the charges paid to banks for issuance of Performance Bank Guarantees (PBG), excluding GST and other applicable taxes.

Yes, the assistance under the Bank Guarantee Charges Reimbursement Scheme can be availed multiple times in a financial year by the SC/ST entrepreneurs. However, the total assistance would be restricted to the maximum ceiling of 50% or Rs.1,00,000 on PBG charges paid.

To apply for the Bank Guarantee Charges Reimbursement Scheme, the applicant must submit a copy of their Udyog Aadhaar Memorandum (UAM) or Goods and Services Tax (GST) registration, proof of caste certificate, partnership deed (for partnership firms), memorandum and articles of association (for LLP or private limited companies), debit statement showing PBG charges, copy of PBG issued by the bank, cancelled cheque of the enterprise's current account, proof of amount transferred as reimbursement by NSSHO, and purchase/supply/work order from government organizations against which the PBG was taken.

To submit a claim, the applicant should approach the nearest NSSH office, fill the prescribed application form, and submit it along with the required documents. The NSSHO will verify the application and documents, and forward the eligible proposals to the NSSH cell at NSIC Head Office for approval.

The applicant should submit their claims for reimbursement within 45 days from the issuance of the Performance Bank Guarantee. Once the claim is submitted, the NSSH Office will conduct an inspection and release the reimbursement within 45 days from the receipt of the application, subject to approval.

No, any SC/ST owned MSE availing reimbursement under the Bank Guarantee Charges Reimbursement Scheme cannot avail reimbursement of bank charges on the same PBG from any other scheme of the government or private agencies.

No, the submission of the application form and documents does not guarantee the reimbursement under this scheme. The reimbursement is subject to verification, approval, and fulfillment of the scheme's eligibility criteria and conditions.

For any queries or clarifications regarding the Bank Guarantee Charges Reimbursement Scheme, the applicant can contact the NSSH cell at NSIC Bhawan, Head Office, Okhla Industrial Estate, New Delhi, or drop an email to the concerned authorities.