i. |
Eligibility |
- |
All persons/proprietorship firms/Regd. Partnership firms/Companies engaged in trade or service of any commodity/goods and are in their line of business for at least 2 years, who are the bonafidemembers of the bank. |
ii. |
Purpose |
- |
For working capital requirements only. |
iii. |
Nature of facility |
(a)
(b)
|
The credit facility may be sanctioned either in the form of an overdraft or as a loan. Method of Assessment of Working Capital:
The credit limit is to be considered as under :-
Advance value (market value – margin) of the collateral assets to be charged
or
20% of the projected Sales subject to verification of VAT/Sales Tax Returns of previous years/quarters.
Whichever is lower of column (a) or (b). |
iv. |
Limit |
- |
Minimum : Rs. 5.00 Lacs
Maximum : Rs.125.00 Lacs |
v. |
Margin |
i)
ii) |
40% on market value of immovable property in case of residential properties.
50% on market value of immovable property in case of commercial properties. |
vi. |
Security |
i)
ii) |
Primary : Hypothecation of stocks and Book Debts
Collateral : Tangible collateral securities in the form of mortgage of non-agricultural freehold land and buildings, National Savings Certificates, our Bank Term Deposits, Life Insurance Policies (Surrender Value) etc. |
| vii. |
Valuation |
- |
The value of the property, to be charged to the Bank as collateral security for the facility is to be as per the Valuation Report given by approved valuers on the panel of the Bank, as per Bank’s policy to be in force from time to time. |
| viii |
Insurance : |
- |
- Comprehensive insurance of immovable property with Bank’s clause at party’s cost.
- Comprehensive insurance of stock with bank’s clause at party’s cost
|
ix. |
Period |
- |
Overdraft : 12 months subject to annual review
Loan : Maximum 72 months (depending on the repayment
capacity), CEO is authorized to relax the repayment period on merit of each case.
Repayment schedule of Loan : Repayable in equal monthly instalments. |
x. |
Rate of Interest |
|
As per Bank’s Rules, subject to penal interest for non-compliance of terms of sanctions.
Commitment Charges : 2% of outstanding loan amount if taken over by any other financial institution/bank before due date (applicable for loan facility only). |
xi. |
Other Conditions |
a)
b)
c)
d)
e)
f)
g)
h)
|
Undertaking from the borrowers to exclusively deal with our Bank to be obtained.
Borrowers to route their entire sales through their Overdraft/Current A/c with the branch.
Stock statements to be obtained only twice a year i.e. as of September & March every year.
Inspection to be conducted once a year. Pre-sanction inspection to be conducted and report to be kept on record.
Obtention of financials i.e. Balance Sheet and Profit & Loss A/c is dispensed with. However, declarations on annual sale supported by Returns/Assessment of Sales Tax/Income Tax etc. be obtained and kept on record at the time of annual review.
The undertaking from the borrower declaring that he does not owe any overdue statutory dues like Sales Tax, Income Tax, Corporation Tax, Professional Tax etc. and has obtained/renewed licences from concerned authorities required for trading in the merchandise/goods, on annual basis.
Branch to endeavor to display Bank’s name as financier from publicity angle.
Branch to endeavor to display Bank’s name
|
