CGTSI/ (44)/

January 2, 2003

All Member Lending Institutions of CGTSI

Circular No. 9/2002-03
Dear Sir,
Credit Guarantee Scheme Lodgment of Applications by floppy
The above Scheme is being operated by the MLIs of Trust since January 2001.
As you are aware, the entire operations under the guarantee scheme are in
electronic mode (Online). For the purpose, each Operating Office of our Member
Lending Institutions (MLIs) is allotted a Member-id, User-id and Password. The
operating office concerned can log on to the website of CGTSI by using this
information and submit the applications online. In order to facilitate the operating
office to send applications in batch mode, ThinClient software has been provided to
these offices by CGTSI. Using the ThinClient software, the operating office can first
fill in the required information, as per the format provided, for each of the loan
proposal and then upload all the applications, irrespective of number of such
applications, at a time to CGTSI website. CGTSI picks the data uploaded by the
MLIs, periodically from its website and process the applications. The decision on the
application is normally taken within a day's time and Operating Office of MLI is
informed through mail about the status of the applications lodged with CGTSI online
or uploaded using thinclient software. The Operating Office concerned is required to
login to CGTSI website and open the mail to see the status of the applications lodged
by it. As soon as the guarantee cover is approved, a Demand Advice (CGDAN) is
sent by CGTSI by mail to the Operating Office concerned. On receipt of the Demand
Advice, the requisite guarantee fee as indicated in the Demand Advice, is required to
be remitted by the Operating Office to the Collecting Bank of CGTSI. Guarantee fee
is payable within 30 days from the date of first disbursement effected by the
Operating Office of MLI to its borrower. However, where loan has already been
disbursed, the guarantee fee is payable within 30 days from the date of Demand
Advice. While making the payment of guarantee fee, the Operating Office of MLI
should also indicate the relevant application identification number (CGPAN) allotted
by CGTSI and mentioned in Demand Advice.
In the above backdrop, since the entire operations under the guarantee
scheme were to be in electronic mode (Online), we had requested the Head Offices /
Central Offices of the MLIs to identify the ZOs/ROs, etc wherefrom they proposed to
lodge the applications for seeking guarantee cover. After receiving the names and
addresses of such offices, Member Id, User Id and Passwords were allotted to them.
Since the operating offices (ZOs / ROs) of MLIs are normally located in big cities
/towns, it was expected that they will be having Internet connectivity for submitting
the applications to CGTSI in electronic mode. CGTSI, however, at the request of
some of the MLIs, allowed lodging the applications through floppy using
ThinClient software and send by post. It was then expected that such operating
offices would soon be having the Internet connectivity in their offices and would be
submitting the applications Online by uploading the data through Internet. It is,
however, observed that even after passage of almost 2 years, some of the operating
offices of a few MLIs continue to submit the applications to CGTSI by post through
floppies and ask us to post the decision on the applications lodged, by fax / courier.
Incidentally, it may be mentioned that many a time, the floppy sent by MLIs gets

corrupted and the applications data could not be uploaded at CGTSI end. Many a
time, the officials of operating offices do not follow the instructions while exporting
the data on floppy, resulting in unverified / unchecked applications being forwarded
through floppy. Under these circumstances, we had to request the operating office
concerned to re-lodge the applications.
The issue was discussed at the IBA Review Forum at its meeting held on
December 14, 2002. The consensus was that all banks have computerized their
operations and that all MLIs operating offices should effectively make use of the
technology in place for cost effective communication and for availing of expeditious
services.
In order to effectively utilize the benefits of the systems / technology in place
and also to give real time service to the MLIs, it has been decided that the Trust will
accept the applications lodged by operating offices through electronic mode (Online)
effective April 01, 2003. In other words, applications received by post through
floppies will not be entertained after April 01, 2003.
You are requested to please give necessary instructions to your operating
offices in this regard.
Thanking you and soliciting your cooperation,
Yours faithfully,

N.Venkatasubramanyan
(Chief Executive Officer)