Sublimit represents a limit carved out within a parent facility for a specific product or usage, such as LC, BG, PCFC, or buyer’s credit. It controls exposure allocation under the overall sanctioned limit. Sublimits should not exceed the parent limit. In MSME lending, it shapes how the facility is structured, priced, documented, disbursed and monitored after sanction. It should be reviewed with the borrower’s actual cash flows, existing exposure, repayment behaviour and the purpose for which the facility is being used. For example, a borrower may have one overall working-capital limit with separate sublimits for cash credit, LC and bank guarantee. It matters because facility terms influence cash-flow burden, utilisation behaviour, approval authority, documentation and customer communication. The common caution is to verify the amount, tenor, repayment cycle, moratorium, security, renewal terms and approval conditions instead of reading the field in isolation.