CMA stands for Credit Monitoring Arrangement. It is a standardized financial statement format mandated by the Indian Banks' Association (IBA) for bank credit assessments. CMA data includes Operating Statement, Balance Sheet projections, Fund Flow Statement, MPBF (Maximum Permissible Bank Finance) calculation, and key financial ratios. It is required for all working capital loans above ₹5 lakh.
A complete CMA data report includes: (1) Operating Statement — revenue, cost of production, gross profit, net profit, (2) Balance Sheet — assets and liabilities for 5 years, (3) Fund Flow Statement — sources and uses of funds, (4) Working Capital Assessment — MPBF calculation via Tandon Method II, (5) Current Ratio (must be ≥ 1.25), (6) Debt-Equity Ratio, (7) DSCR.
MPBF (Maximum Permissible Bank Finance) is the maximum working capital loan the bank can sanction, calculated using RBI's Tandon Method II. MPBF = 75% of (Total Current Assets − Other Current Liabilities). The bank also ensures the resulting Current Ratio is ≥ 1.25. Cred automatically calculates MPBF and adjusts it to meet the CR ≥ 1.25 requirement.
CMA data is mandatory for: all working capital loans above ₹5 lakh, term loans above ₹25 lakh, and MSME loans of any size in practice. For MUDRA Kishor and Tarun, PMEGP, Stand-Up India, and all bank loans above the threshold, CMA data must be submitted in IBA-prescribed format.
CMA data is traditionally prepared by Chartered Accountants (CAs) or financial consultants. However, with Cred by Fastlegal, the CMA data is auto-generated from your project inputs — accurately and in the exact IBA format — in under 60 seconds. No CA needed for the calculation part.