WORKIN CAPITAL LOAN

Objective: To meet the day to day operations mainly for stocks, book debts and overheads expenses of the clients/companies, a short-term loan is financed in the form of working capital loan.

Type of Assistance: Working Capital loan is extended for 1 year and subject to renewal each year on the same or altered terms as may be agreed upon by the banks and the borrowers mutually.

Eligibility:
 Financially sound companies.
 Should have been in operation.

Promoters’ Contribution: Minimum 30%.

Debt Equity Ratio: Maximum up to 70:30.

Service Charge: 1.50% on total loan approved, only one time prior to disbursement.

Security: Registered mortgaged over entire project including all the movable and immovable assets, present constructions and construction to be made in future.
 Additional collateral as required,
 Hypothecation of stock-in-trade,
 Assignment of bills and account receivables,
 Personal guarantee, and
 Corporate guarantee as required.

Tenure 1 – 15 Years

Repayment:
 In quarterly installment to be fixed on case to case basis depending on projected cash flow of the borrower.
 In the event of non-payment of any installment or in the event of any other irregularity continues, in such a situation a penalty will be levied as per the FI’s regulations.

Documentation:
 Loan Agreement Paper.
 Hypothecation Deed.
 Personal Guarantee from major promoters.
 Corporate Guarantee.
 Promissory Note.
 Internal Loan Commitment Paper.
 Registration/Tax Clearance Certificates including (VAT).
 Articles of Association and Memorandum of Association.
 Loan Authorization Letter.