Loan facilities provided to the borrowers for over a period of one year & above and are repayable in scheduled installments along with the interest, as mutually agreed up on will be classified as Term loans.
Term Loans are extended for Procurement of Capital goods like Equipment, Machinery, Furniture, Show Room, Factory Premises, Vehicles etc.
Any Commercially viable and Lawfully permitted activity either Industrial or Non Industrial is eligible for Term Finance
Entrepreneur having valid statutory / business license, experience / qualification in the line of activity is eligible.
Need based finance will be considered by the Bank on individual assessment of the proposals. The assessment will be made on Personal investigation, Confidential reports from Market, Other Banks, Chamber of Commerce or any other controlling agency of the business concerned; The balance sheet, Trading account, Profit and loss account; Memorandum and articles of association if any, and other relevant documents; The age / type / average balances / present balance / nature of operations during the last six months, of the account with us etc.
Generally prescribed Margin is 25%. However, it is decided on case to case basis.
Along with prescribed Application, the applicant to submit Financial Statements like Project Report along with the Feasibility Report, Balance Sheet, Trading A/c, P&L Account etc., - audited for past 2 years & projections for next two years.
Rate of Interest may range between 15% to 25% and will be assessed on case to case basis. Interest will be calculated on daily product basis and will be applied at the end of every month.
Facilities will be secured by way of
(i) hypothecation / pledge of stocks / goods / machinery / equipment etc.
(ii) Mortgage / Creation of charge on suitable Immovable Properties.
Moratorium Period is allowed on the basis of Fund Flows of the Project.
Repayment in Monthly / Quarterly / Half Yearly Installments in not exceeding 3 years.
Repayment Schedule will be fixed on the basis of Cash Flows, Repayment Capacity & Debt Service Coverage Ratio.