||Micro & Small Enterprises in rural, semi urban and urban branches
|Type of Loan
||Composite Loan in the Form of Demand Loan
||Investment and working capital requirements
|Quantum of Loan
||Maximum amount will be restricted to Rs. 1 lakh for units in rural areas and Rs. 5 lakhs for units in semi urban & urban places (the quantum of loan will be determined by the location of the unit).
|Rate of Interest
||8.50% p.a. linked to BPLR without minimum clause for limits up to Rs.1 lakh for units located in rural areas.
9.00% p.a. linked to BPLR without minimum clause for other units irrespective of limit.
||Demand loan is to be repaid over 36 months inclusive of 3 months moratorium
No collateral security/third party guarantee to be obtained.
- Hypothecation of Assets created out of bank finance as well as existing unencumbered assets of the MSE unit.
- Equitable Mortgage of Land/ Land & Building which is part of the business activity such as business premises.
- Guarantee Cover under CGTMSE Guarantee Scheme. As the maximum loan limit is Rs.5 lakhs CGTMSE cover is available up to 85%.
||As per the extant guidelines credit rating for loans up to Rs. 10 lakhs is exempt.
||Concessionary Processing charges of flat Rs.500.00 in rural areas and Rs.1000.00 in other cases will be levied.
- Demand Promissory Note.
- Deed of Hypothecation CHA 1.
- Installment Letter.
- Documents for fulfillment of KYC norms.
- Other connected documents applicable for Demand Loans as per extant guidelines.
- Equitable Mortgage as Primary Security wherever applicable.
- Simplified Application and Proposal Forms given in the annexure to be used.
- Special SME hubs to be set up at each district level branches or in a cluster of branches depending upon the expected business volumes for processing and sanction of all proposals beyond the branch delegated authority. Pending formation of Special SME hubs, Zonal SME hub will look after this work wherever the limit exceeds branch authority.
- Turnaround time for sanction will be 2 working days after all relevant information is obtained.
||The scheme will be implemented directly by the Bank. No outside agency whether Government or otherwise will be involved in the implementation
||Advance under this scheme will be classified MSME advance with Sector Code 32, Scheme Code 209 and Special Category Code from 150 to 173 depending upon the original cost of investment in plant & machinery/ equipment. BSR Code will depend upon the activity.