Question

Loans under consortium lending scheme will be provided on:

• A. Primary Security
• B. Government guarantee
• C. Mortgage of property
• D. None of the above

Answer 1

Answer:

B. Government guarantee

Under some consortium lending arrangements, especially for large-scale or high-risk projects, banks may require a government guarantee as security for the loan. This ensures that if the borrower defaults, the government will cover the loss, reducing the risk for participating banks.