Eligibility

• Individuals, Proprietorship, Partnership concerns (including Limited Liability Partnerships), Limited Companies, etc. engaged in the activity.

Purpose

• To meet the working capital requirements.
• For purchase of new machinery, equipment, expansion of unit.
• For construction/renovation of factory building.

Nature of Facility

• Fund Based: Cash Credit (Stock & Book Debt) and Term Loan.
• Non Fund based as per existing guidelines for MSME advances.

Quantum of Finance

• Minimum amount of loan Rs.0.10 Crore (Rs.10 lacs)
• Maximum amount of loan Rs.100.00 Crore (from banking system)

Margin

• 25% for Stock.
• 25% for Book Debts.
• 25% for Term Loan (acquisition of Plant & Machinery)
• 35% for factory building (Construction/Renovation).

Security

• Primary: Hypothecation of Stocks &  Book Debts
• Collateral:
• Minimum collateral coverage to be 50% for limits upto Rs.10.00 crores.
• 40% for limits above Rs.10 croresupto Rs.50.00 crores, but minimum collateral value should not be less than Rs.5.00 crores
• 30% for limits above Rs.50.00 croresupto Rs.100.00 crores, but minimum collateral value should not be less than Rs.20.00 crores
• Guarantee: Personal guarantee of Promoter Directors, Proprietor, Partners of the Firm/company having sufficient means and of all mortgagor of collateral security.

Repayment

• Working Capital I Term Loan limits:
• 12 months for WC and subject to renewal as per extant guidelines.
• Term Loans to be repaid in maximum 84 monthly installments inclusive of moratorium period in line with the projected cash flow.

Forms & Documents

• For Term loan-AppropriateDP note, Term loan Agreement general term loanagreement, Deed of Guarantee, letter of undertaking not to alienate hypothecated goods, mortgage deed , letter of continuity, letter of general lien and setoff, undertaking from borrower/guarantor for disclosure to CIBIL and any other document stipulated in sanction advise.
• For cash credit – Appropriate DP note, hypothecation of goods & book debts, letter of guarantee, letter of undertaking not to alienate hypothecated goods, mortgage deed , letter of continuity, letter of general lien and setoff, undertaking from borrower/guarantor  for disclosure to CIBIL and any other document stipulated in sanction advise.