Loans can be sanctioned for the following business-related purposes generally
coming under Micro, Small and Medium Enterprise:
>> To start a new business/company or expand the existing enterprises
>> To purchase plant & machinery such as testing or lab equipment/machines, electrical
appliances, furniture, spare parts, etc.
>> To start manufacturing industries, ancillary industries like manufacturing components
for machines for other firms or medium-sized businesses, service industries like
electronics retailers and the construction sector etc.
>> To start feeder industries and quarries or mining units.
>> To start small scale business like holiday resorts, rice milling unit, cold storage, skill
development centre, ladies garments, production of jute gunny bags from fabric,
biodegradable plastic bags, baby & adult diaper and sanitary pads, aluminium foil for
food packaging, food and beverage industry, kitchen spices (masala powder), spices
powder, readymade mixes (red chilli powder, sambar masala, biryani masala, chicken
fry masala, and garam masala), spice powder (turmeric, chilli, pepper, coriander and
cumin powder),
>> To purchase of equipment like computers, air conditioner, furniture & fixtures and
other fixed assets like commercial vehicle for the purpose of running business.
>> For the construction of building spaces or acquisition of land/factory or commercial
properties
>> To meet working capital requirements like paying salaries, purchase of goods and raw
materials, stocking up inventory, marketing and advertising purposes, etc.
>> To buy new or pre-owned machinery/equipment or a fleet of vehicles
>> For any additional funding assistance for business and related purposes
o All business enterprises engaged in manufacturing, services and trade sector will be
covered under the scheme. Existing and new units are eligible under the scheme.
o MSME units irrespective of constitution i.e. individuals, proprietorship, partnership,
limited companies, trust association
o In case of individual/proprietorship entry age is restricted up to 65 years (age at the
time of sanction) and under any circumstances the repayment period should not exceed
the day on which the applicant attains age of 70 years.
o Enterprises engaged in speculative activities/real estate activities are not eligible for
financial under this scheme.
o In case of fixed immovable properties viz. land and building, liquid securities like
bank’s own deposit, LIC policies etc. are permissible for this scheme.
o Current account shall be maintained with this bank. The cash flow of the particular
project financed by the bank should be routed through the current account maintained
with the bank for running the business.
Maximum loan amount of ₹ 40 lakhs, subject to the conditions specified hereunder. For existing units: Maximum 25% of projected annual turnover for existing business/enterprise assessing sales performance of preceding 3 years and average growth of the business unit. For new units: Maximum 25% of validated year around projected turnover and assessing the capability of the borrower to raise adequate funds by the Branch Manager and Loans Manager.
The Bank offers a maximum amount of ₹ 40 lakhs as MSME loan with a loan margin of 20%.
The maximum period of loan shall be 7 years. In the case of existing business/ enterprise, repayment of the loan shall commence after 12 months of disbursal of the loan or on the month on which the business/enterprise becomes operational whichever is earlier. The waiting period is assessed accordingly.