Answer-In relation to the CGTMSE scheme, w hich of the following is correct with respect to the a secu...

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Answer-In relation to the  CGTMSE  scheme, w hich of the following  is correct with respect to  the a  secu...

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Primary security is the asset created out of the credit facility extended to the borrower and  or which are directly associated with the business  project of the borrower for which the credit facility has been extended. Example  Land, Plant  Machinery or any other business property in the name of a proprietor or unit, if unencumbered, can be taken as primary security. The personal guarantee is also a primary security in following cases      I n case the constitution of the borrower is proprietary or partnership, the personal guarantee of proprietor partner is treated as primary security .        Personal guarantee of directors, where borrower constitution is a company is treated as primary security .      Obtaining Primary Security is mandatory for Guarantee Coverage under Credit guarantee schemes by CGTMSE.    Collateral security is not required which includes other security offered for the said credit facility. For example, hypothecation of jewellery , mortgage of house, etc. or any third-party guarantee. Note that p ersonal guarantee of spouse, friend etc. will be treated as third party guarantee.

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