Skip to content

CS Executive · Setting Up of Business, Industrial and Labour Laws · Micro, Small and Medium Enterprises

Which of the following is a stated purpose of the credit policies and practices that the Reserve Bank's guidelines are meant to secure for MSMEs under the Act?

The stated purpose is to minimise the incidence of sickness among MSMEs. Section 10 says credit guidelines ensure timely and smooth flow of credit, reduce sickness and enhance competitiveness; it does not fix interest rates, guarantee loans or waive repayment.

  1. ATo minimise the incidence of sickness among such enterprisesCorrect
  2. BTo fix the minimum interest rate payable by such enterprises
  3. CTo guarantee loans to every enterprise registered with the Board
  4. DTo exempt such enterprises from repaying bank loans during closure

Explanation

Section 10 states that credit policies are meant to ensure timely and smooth flow of credit, minimise the incidence of sickness and enhance competitiveness. The Section mentions no minimum interest rate, blanket guarantee or exemption from repayment.

Did you get it right without looking?

One question tells you little. A timed set on Micro, Small and Medium Enterprises shows your real accuracy, how long you take and where you lose marks.

Practise Micro, Small and Medium EnterprisesFree diagnostic mock

More Micro, Small and Medium Enterprises questions