Financing out of Co-operative fold for expansion and or modernisation of Projects:

 

Objective:

To extend finance for expansion and / or modernisation of the existing projects outside co-operative fold and working capital.

 

Borrowers Eligible:

Registered firms, companies, businessmen.

The applicant must be in profit during last two consecutive years and just be rated not lower than investment grade rating agency registered by SEBI. Such rating should not be more than 1 year before.

 

Types of loan:                                                                                            

Medium term loan for expansion and modernisation and Short term loan for working capital.

 

Medium term Loan:

 

Quantum of loan:

50% to 75% of project cost. Based on the credit rating, subject to the permissible exposure as per existing norms.

 

Rate of Interest:

Linked to credit rating not less than 12.75% per annum.

 

Repayment Period:

Total repayment period will be maximum 7 years, including moratorium of maximum two years depending on cash flow with equated monthly installments.

 

 Working Capital:

 

Quantum of loan:

50% to 60% for each production cycle, based on the credit rating subject to the permissible exposure as per existing norms. The borrower have to maintain maximum 40% margin.

 

Rate of Interest:

Linked with credit rating but not less than 11.50% per annum. Interest will be recovered monthly.

 

Repayment Period:

The loan has to be repaid within a year and limit will be renewed for next production year before expiry as per request of borrower.