A CMA report is a vital evaluation of a business’s working capital needs, which is considered by bankers when funding those needs. To grant working capital, such as Cash Credit against Stock and/or Debtors balance, bankers consider various factors, including industry-standard ratios that must be in place for their comfort. The Credit Monitoring Arrangement (CMA) report, also known as the Credit Monitoring Report, is a comprehensive financial document that provides a projected and past performance overview of a business. It includes all necessary financial ratios and metrics required to assess the financial health of a business, making it a crucial report for financial analysts and bankers.
Most banks and financial institutions require a professionally prepared CMA report from loan applicants to understand the flow and application of funds in their business.

• A well-prepared CMA report can increase the chances of obtaining a bank loan, making it a valuable asset for businesses.
• Under the CMA, banks are allowed to sanction credit proposals for large borrowers after a detailed analysis of their past performance.
• In addition, banks are required to submit large credit proposals with working capital limits of Rs. 500 lakhs (5 crores) and above, and/or term loans exceeding Rs. 200 lakhs (2 crores) to the Reserve Bank of India for post-sanction scrutiny.