IPSB VYAPAR SCHEME

i.

Nature of facility

–

Overdraft or Loan.

ii.

Purpose

–

Working capital requirements. Non Fund based facilities (i.e. Bank Guarantee and Letter of Credit).

iii.

Limit

–

Minimum : `   2.00   Lacs

Maximum :   Subject to the exposure limit of the Bank

iv.

Eligibility:

a)

Individuals, Proprietorship, partnership concerns, Firms, Private Ltd. Cos. (HUF & Public Limited Cos. are not eligible.)

b)

c)

The business units should have been established in the line of business for a minimum period of 1 years.

Trading units established by our existing customers with satisfactory dealings or their close relatives, even if these are established for less than  1 years

v.

Method of assessment of working capital Limit:

The credit limit is to be considered as under:

–

20% of the projected sales subject to verification of sales tax returns of previous years/ quarters   OR

–

Advance value of the collateral assets to be charged, whichever is lower.

In case of Overdraft, if the credit turnover in the a/c in the preceding month is not adequate to cover the Interest debited, then interest debited be recovered separately.

vi.

Margin

a)

35% on market value as per recent valuation report of immovable property,

b)

15  % on Bank’s own FDRs

c)

15% on the surrender value of Life Insurance Policies, NSCs,

vii.

Period

–

12 months subject to annual review

viii.

Repayment

–

Maximum 72 EMI (depending on the repayment capacity)

ix.

Security

–

Mortgage of non-encumbered freehold property self occupied property.

NOTE: Property to be mortgaged may be ONLY in the name of either Borrower or Co-Borrower, Joint owner, Proprietor, Partner, Director or their Close relative (viz. spouse, parents, brother, sister, son & daughter) who should stand as guarantor.

Loan  may be considered against the property already charged to bank or against the residual advance value available in security offered and charged under IPSB Vyapar, if the borrower is joint owner, spouse of borrower or parents of borrower.

x

Valuation

Branch to obtain a valuation report on the property to be mortgaged, from Bank/Govt. approved valuer. Further the valuation is to be done  once in two years. Valuation fee is to be borne by the applicant

National Savings Certificates, our Bank’s Term Deposits, Assignment of Life Insurance Policies,                standing in the name of the borrower/proprietor/partner/director only.

xi.

Insurance:

–

Property mortgaged should be insured as per bank’s norms Obtaining insurance against the stocks cover may be a condition for sanction of the facility.

xii

Sureties

–

At least two sureties of good means and reputation, subject to the satisfaction of the bank.

xiii.

Other Conditions :

a)

Borrowers to route the sales and all other transactions through their Overdraft/ Current A/c (in case of loan) with the branch.

b)

Branch to ensure end use

c)

Stock statement to be obtained Twice in  a year i.e. as of last day of August & February, by 10th of following month every year.

d)

Borrowers will not be considered for Working Capital assistance both under vyapar as well as under our usual scheme simultaneously.

e)

However, Retail Traders enjoying finance under the existing scheme can have the facilities transferred into IPSB Vyapar, if they so desire, after providing for the collateral security.

f)

Inspection to be carried out twice in a year and inspection Report to be kept on record.

g)

Pre-sanction inspection to be conducted and report to be kept on record.

h)

The undertaking from the borrower declaring that he does not owe any overdue statutory dues like Sales Tax, Income Tax, Corporation Tax, Professional Tax etc. and has obtained/ renewed licenses from concerned authorities required for trading in the merchandise/ goods, every year.

i)

Other documents as per constitution of the borrower and terms and conditions of the sanction.

j)

Obtaining of financial statements, declarations on annual sales supported by Returns / Assessment of Sales Tax, Income Tax etc. be obtained and kept on record at the time of annual review.

h)

Where security is in the form of our Bank’s FDR, the same should be appropriated in case there is a default in servicing interest for one quarter and a/c slips back to NPA.

i)

In case of Guarantee and L/C, banks extant guidelines to be observed.

j)

On the recommendations of Chief Executive Officer, BOD may relax the margin on the merits of each case.