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IND EQUIPMENT & WHEELS (CE/CV) scheme

IND EQUIPMENT & WHEELS (CE/CV) scheme

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IND EQUIPMENT & WHEELS (CE/CV) scheme

S.No Parameters Product Features
1. Target Group All MSME units having URC/ UAC ,engaged in Manufacturing, Service / Trading activities as per extant guidelines of Govt. of India.
2. Purpose ü  For purchase of various Machineries/ Equipment’s, E-Vehicles, Commercial Vehicles / Buses including Material handling equipment’s / Earth moving, Excavation, construction and mining equipment’s etc.

ü  Only newly purchased machineries / equipment’s/ Vehicles are permitted for financing under the scheme.
3. Eligibility ü  MSME units with business vintage of minimum 2 years.

ü  Net worth of the unit should be positive.

ü  Existing facilities availed (if any), should not be appeared in SMA-2 & above during last 12 months.

ü  CMR of 1 to 4 or equivalent CIC score.

ü  In case of CMR 5-6 or equivalent CIC score / CMR-NA, Credit policy guidelines to be complied.

ü  Units with business vintage of less than 2 years but group accounts having business vintage of 2 years and making cash profit, can be considered.
4. Nature of Facility Term Loan, Capex LC (Inland / Import) as sub limit of TL.
5. Assessment ü  Based on Cash flows of the unit and compliance to DSCR.

ü  New Units can be considered based on realistic projections.
6. Loan Amount ü  Minimum Loan Amount: Above Rs 10.00 Lakhs

ü  Maximum Loan Amount:

No of Years of Business Vintage Maximum Loan amount
Upto 2 Years Rs.1.00 Cr
> 2 Year Rs 2.00 Cr
>3 Year Rs 5.00 Cr
>4 Year Rs 10.00 Cr
>5 Years Rs 25.00 Cr

ü  Credit Proposals beyond Rs 25 Cr under the scheme can be considered at Corporate Office based on Single / Group exposure limits.

ü  Relaxation in business vintage and Quantum of loan, may be considered by ZLCC & above with suitable risk mitigations and shall be restricted to proposals with CMR 1-4.
7. Margin (Promoter’s Contribution) ü  Machinery/ Equipment à 15%

ü  Commercial Vehicles à 20%

 

ZLCC & above can extend 5% relaxation in margin for CMR 1-4. In case of Capex LC, required margin on LC will be at par with Term Loan.
8. Repayment Period & Holiday Period
Particulars Max Moratorium Door to Door Tenor
Commercial Equipment* Up to 2 Months Maximum 60 Months
Commercial Vehicle Up to 2 Months Maximum 60 Months

 *Sanctioning authority may consider tenor upto 84 Months on case to case basis.

 

ü  Interest during holiday period is to be serviced as and when debited.

ü  Limit sanctioned can be availed in tranches as per the requirement of the borrower.

ü  Borrower can be approved with credit line as per eligibility which is to be availed                  within a maximum period of one year from the date of sanction. (i.e. Initial availment of limit should be within 6 months and full availment of limit to be within 1 year from the date of sanction)
9. Security :

 

Primary: Hypothecation of Machineries/Equipment’s/ Vehicles / asset created out of loan proceeds.

Collateral Security Requirement
Existing Borrowers having Credit Limits covered by Immovable / Liquid Security An undertaking from the borrower to be obtained  taking their consent for non-release of existing securities till the closure of  credit facilities sanctioned under the scheme as detailed in the Annexure – II
New to Bank Customers/ Existing Borrowers without any Immovable /Liquid security coverage CMR 1-4 or equivalent other CIC score CMR 5 & 6 or equivalent other CIC score, NA
ü  Nil collateral, if covered under CGTMSE. Guarantee Fee to be borne by borrower.

 

ü  Coverage under Hybrid model is also permitted as per extant CGTMSE guidelines.

 

ü  In case, the borrower is not willing to cover under CGTMSE, minimum 25 % of loan amount to be secured by way of immovable property/liquid security.

 ü  Promoter/ Partner have CIBIL score of 730 & above or equivalent other CIC score.

 

ü  Additional 10% collateral by way of immovable property/liquid security.

 

ü  Requirement of additional 10% collateral can be waived by Sanctioning Authority, if the proposed loan is covered under Hybrid model of CGTMSE.

ZLCC & above will have the discretion to reduce Collateral security coverage up to 10% on case to case basis for CMR 1-4 borrowers.

 

Guarantee: Personal Guarantee of all the Promoters/partners/directors of the unit and Property owners are mandatory.
10. Rate of Interest a) Accounts having Immovable properties / liquid securities / Hybrid Security:

Rating Repo Prime

Spread

 Business Spread Total
A & above 6.50% 2.70% 0.30% 9.50%
BBB 6.50% 2.70% 0.50% 9.70%

b) Accounts with CGTMSE Coverage:

Rating Repo Prime

Spread

 Business Spread Total
A & above 6.50% 2.70% 0.50% 9.70%
BBB 6.50% 2.70% 0.80% 10.00%
11. Documentation D7, D36, D101, F 172, F189 and D 32, D34, D57 wherever applicable, other constitution based documents and all other applicable documents as per documentation manual.
12. Sanctioning Authority As per Power Booklet up to their Discretionary Powers.
13. Upfront fees / Processing

Charges, Other Charges

 ü  50% Concession in Processing charges/ Upfront fee.

ü  Other Charges as per Service Charges Circular.

ü  Concessions in service charges may be extended as per delegated powers in Discretionary Power Booklet on case to case basis.
14. Prepayment Penalty As per latest service charge circular.
15. Bench Mark Compliance
Covenant Benchmark*
TOL/TNW (WC & TL) 5:1
Debt Equity Ratio (TL) 4:1
DSCR (TL) Avg.1.50  / Min. 1.25
Fixed Assets Coverage Ratio (TL) 1.20

 *Any deviation in benchmark ratios to be dealt as per delegated powers.
16. Entry Level Barrier
Exposure of  Rs 1 Cr & above Combined internal rating IB BBB (Based on ICON Rating)
Exposure up to Rs 1 Cr Internal rating BBB (Based on Scoring Model)
17. Take Over Guidelines Not Permitted.
18 Other Conditions ü  Pre-Approved line of credit can be considered to the eligible borrower for 12 months based on annual purchase plans and other factors.

ü  Amount should be remitted directly to the dealers / suppliers by DD / NEFT / RTGS.

ü  Due diligence of the suppliers to be ensured.

ü  Units should have necessary approvals from the statutory/ regulatory authorities (wherever applicable)

ü  All securities should be adequately insured with Bank Clause– Premium to be borne by the borrower.

ü  Charges to be registered with ROC/SRO/Vahan Portal/ others as per extant guidelines.

ü  Promoters’ contribution should be brought up front/ proportionally.

ü  Pre-Release Audit/legal audit have to be conducted as per extant guidelines of Credit Policy.

ü  Relaxation by field functionaries if any Viz, business vintage, quantum of loan, Margin, Collateral Security etc shall be restricted to applicants with CMR 1-4.

ü  Proposals with obligor rating of BBB+ & above can be sanctioned by respective Sanctioning Authority.

ü  Proposals with obligor rating of BBB & below to be sanctioned by ZLCC & above, subject to availability of collateral security or co-borrower with sufficient income.

ü  Loans covered under CGTMSE having obligor rating of BBB(-) are not to be financed under the scheme.

ü  Preference under the scheme to be given to borrowers with obligor rating of BBB+ & above having tie-up arrangements with cash flows.

ü  For NTB customers, customer due diligence and CKYC to be verified for creating new CIF.

ü  Customer Due Diligence guidelines to be adhered including SMA/ NPA status of customer, Wilful Default / Suit Filed / Non Suit Filed / CIBIL default checks etc.

ü  Relaxation if any of the product features to be placed to COLCC(GM) & above for approval.

 

 

 

 

 

 

 

 

 

 

 

( Last modified on Jan 10, 2025 at 11:01:07 AM )

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