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Union MSME Suvidha

S. No


Scheme Guidelines



All units engaged in the Manufacturing/ Services/ Trading activity, eligible to be classified under MSME.

Enterprises engaged in speculative activities/Real Estate activities are not eligible for finance under this scheme.



a. To meet need based working capital (Fund Based & Non-Fund Based) requirement for Business Activity.

b. Term Loan for own business use as under:

Purchase/ Construction / Renovation of Business Premises, Factory / Offices / Shop / Godown / Plant & Machinery / Equipment etc for business activities are eligible. 

Purchase of equipment like Computers, air-conditioner, furniture & fixtures and other fixed assets like commercial vehicles for business.

Any other purpose whereby asset is created out of Bank’s finance for the purpose of running the business.



Term Loan and/or Working Capital (Fund Based and Non-Fund Based)

Working Capital facility in the form of secured Overdraft (OD) to MSME Service Enterprises (Viz., Hospitals, Educational Institutions, Professionals like Doctor, CAs etc) with a maximum limit of Rs 5.00 Crs.Manufacturing & Trading Accounts are not to be considered for OD facility.



Minimum: Above Rs 10 lakh

Maximum: Up to Rs 50.00 Crore [OD – Rs 5.00 Crore]




20% [Stock (excluding dead stock) & book debts aged up to 90 days]


a. NFBWC – 25% (Cash/FDR)

b. Reduction of Margin in LC and BG may be approved by delegated authority as per Policy on Delegation of Loaning Power.

Term Loan

Plant & Machinery / Equipment: 25%

Land & Building/ Building/ Others : 35%



Working Capital [CC/OD]: On Demand

Term Loan: As per extant Loan Policy guidelines of the Bank.


Security Coverage

Primary: All assets created out of Bank’s finance shall be charged in favour of Bank by way of Hypothecation/ Mortgage etc.

Security Coverage :

a. Minimum 75% (125% for OD facility) of the loan amount by way of immovable properties (Land and Building) and / or other liquid assets like NSCs /KVPs/ Deposits/assignment of LIC policies/other Govt. Securities can only be considered for security coverage.

b. Value of immovable property (fully constructed and ready to occupy and ready for mortgage) procured from the TL for own business use can be considered towards arriving the security coverage for aforesaid TL under the scheme for all MSMEs (including Trade) i.e., no additional collateral is required for the TL towards purchase of ready built shop/ office/ warehouse.

c. Security of Agriculture property/Educational Institutions/ Hospital properties/ Religious trusts are not to be considered.

d. 1.50 times weightage for clearly defined liquid securities may be considered for the purpose of pricing only


In-built Top up loan

Branches/Sanctioning authority may consider sanction of need based In-built Top up loan with a cap of 20% of the assessed limit (both Term Loan, NFB/FB working capital), subject to maximum of Rs 5.00 Crore.

For more details, please contact our nearest branch.