New Delhi, Oct 7 (TIWN) The Department of Telecom on Wednesday slashed performance and financial bank guarantee requirement of telecom operators to 20 per cent of the current amount held by the government as part of the telecom reform measures announced last month.

The cabinet last month approved a relief package for the telecom sector that includes a four-year moratorium on payment of statutory dues by telecom companies as well as allowing 100 per cent foreign investment through the automatic route. As part of the measures, it also proposed reduction of bank guarantee requirement of telcos by 80 per cent.  As per a DoT notification, while financial bank guarantee will remain at Rs 50 crore, Rs 25 crore and Rs 5 crore for telcos licencees for category A, B and C service area to be submitted before signing the licence agreement, the amount of guarantee (both performance and financial bank guarantee) will now be 20 per cent of estimated sum payable (of licence fee for two quarters).