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Eligibility
All existing and new Trading firms & Companies are eligible. They should have trading background and experience.
Purpose
For meeting their working capital and capital investments |
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Nature of facility
Fund based
- Cash Credit
- Bills purchase
Non-fund based
- Letter of Credit
- Bank Guarantee
Quantum of finance
As per requirement without ceiling
Rate of Interest
Competitive rates based on credit rating of proposal
Margin
Goods : 25% to 30%
Receivables (Bills): 50%
Book debts : 50%
Term Loans: 25% to 30%
LC and BG : 25% to 30%
Security
Primary:
Hypothecation of goods/receivables
Collateral:
For limits upto Rs.25 lacs – Mortgage of properties covering at least 100% of the loan amount (FB +NFB)
For limits above Rs.25 lacs-
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at least 25% of both FB + NFB Limit + 25 Lacs for borrowers having very good Credit rating.
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at least 50% of both FB + NFB Limit + 25 Lacs for other borrowers having acceptable Credit rating.
Processing charges
As per bank’s norms
Financial position and working results
- Should be consistently profit making and should project profits in future
- Should be equipped to meet the margin on Working Capital requirements of the Bank.
- TOL/TNW should not exceed 1:4
Drawing against receivables
Maximum allowed – 30% of the CC limit.
Receivables should not be older than 120 days. For wholesale dealers in Cement and distribution agencies, drawing against receivables may be permitted even upto 100% of the sanctioned limits subject to Value of collateral security covering at least 150% of the sanctioned limit.
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