|Eligibility of borrower||* Having operative current account holder of the Bank for more
than six months
• Borrower/ Partners/ Directors/ Guarantors must be a member of the Bank.
|Purpose of Loan||To meet Working capital Requirement|
|Quantum of finance||* 20% of annual turnover/ sales of the firm.
* Up to 70% of the value of the stock plus 50% of book debts.
* Current Ratio & Debt Equity Ratio should be at satisfactory level
|Share Linkage||Borrower must have Bank share Linkage @ 1% of the loan sanction amount.|
|Repayment period||Review once in 6 Months and renewal in 12 Months.|
|Rate of Interest||10.75% p.a.|
* Stock and book debts should be hypothecated to the Bank.
* Stock should be stored in R.C.C. built godown own/ rented by the borrower.
* Letter of access will have to be got duly signed by the owner.
* Bank's name plate indicating stocks hypothecated to the Bank will have to be displayed on godown where the stocks stored.
* Godown premises and Stock hypothecated to the Bank should
be fully insured against the risk of fire, theft, burglary, flood,
riots etc by the borrower at his
* Own cost and the policy has to be with Bank clause.
* Borrower has to submit stock statement monthly or as instructed by the Bank within 7 days of the succeeding month otherwise penalty will be levied for delayed submission.
* Third party guarantee of two personal guarantors having good
Credit worthiness and financially sound and member of the Bank.
* Simple mortgage of title cleared property of the borrower/ guarantors.