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MSME Plus

  • Eligibility
    Eligible Entities
    • Proprietorship, Partnership firms, Limited Liability Partnerships (LLPs), Private / Public Ltd. Cos. (Existing as well as New Borrower)
    • Internal Credit Risk Rating should be minimum OBC5 for last two years (in case of existing borrower). For new borrowers rating should be OBC4 and OBCGF4 in case of Greenfield projects
    • External Credit Risk Rating from approved external rating agency of the borrower needs to be obtained and the rating grade should be within stipulated in the scheme.
    Conduct of Account

    Account should have been standard for last two years and should not have been restructured in last two years (From the Banking system). Not applicable for the newly established entities

  • Finance
    Nature of facility

    Working Capital &/or Term Loan

    Quantum of Exposure

    Upto Rs.50.00Crore

    Appraisal/ Assessment

    As per Loan Policy of the Bank for working capital as well as for Term Loan. TEV study, if applicable, be obtained and all other guidelines be complied with.

    Acceptable financial Ratio

    Acceptable financial Ratio as per last audited Balance Sheet, latest available SA certified Provisional Balance sheet (for existing Borrowers only)-

    Current Ratio/Adjusted Current Ratio:

    • 1.17:1 (for working capital limits up to Rs. 5.00crore)
    • 1.25:1 (for working capital limits above Rs.5.00crore) Current Ratio/Adjusted

    Current Ratio if collateral coverage is more than 100%

    • 1.10:1 (for working capital limits up to Rs. 5.00crore)
    • 1.17:1 (for working capital limits above Rs.5.00crore)

    Debt Equity Ratio/ Adjusted DE ratio:- Upto 3:1

    Leverage Ratio/ Adjusted Leverage Ratio:- Upto 4:1

    DSCR

    Average DSCR minimum 1.50:1 in case of term loan and repayment period maximum 7 years.

    Profitability

    The unit should have a post-tax profit in each of the immediate preceding two years. (Not applicable for newly established entities).

    Process Fee/ Upfront Fee

    Process Fee/ Upfront Fee • Entry Level 50% concession,2nd year 25% concession and 3rd year onwards as per Bank’s schedule of service charges. However, if the Internal rating remains within OBC-4 the entry level concession of 50% will continue in subsequent years.

    Guarantee and LC Commission

    25% concession on applicable charges for Borrower accounts having minimum OBC 4 rating or top three highest external credit ratings of the concerned RBI approved rating agencies. Further, to above, accounts where collateral security is more than 150%, sanctioning authority can allow upto 50% concession in applicable BG/LC commission (subject to condition that cost of capital to the Bank is covered)

    Others
    • Concession in charges pertaining to day to day operations like ABB, Remittance charges, Cash handling charges, Cheque Book issuance charges may be permitted as per delegated powers.
    • Exposure to Real Estate and NBFC is not covered in the proposed scheme.
    • The existing customer can be covered under this scheme on becoming eligible before renewal also. However, the account shall be renewed at the time of covering under this scheme.
    • Accounts already covered under this scheme shall become ineligible under the scheme, if rating falls below 5.
    • Environmental related issues be guided as per policy
    Deviations/ Relaxation In The Scheme

    Unless specifically provided otherwise in the Scheme itself, the Field Functionaries shall seek prior permission from HLCC-ED in case of any deviation/waiver in scheme.

  • Security and Margin
    Security

    Primary: As per Bank’s Loan policy Norms Collateral: Advance covered by collaterals covering at least 50% of the exposure (FB+NFB).

    Margin As per Bank’s loan policy/discretionary power chart/other guidelines issued from time to time.
  • Rate of Interest
    Rate of Interest

    Rate of Interest is linked to collateral security coverage: (Exposure Ceiling in crore)-FOR MSE BORROWERS

    Collateral Coverage <=Rs.10.00 Cr >Rs.10.00 Cr up to Rs.50.00 Cr
    50% upto 75% 1 Yr RBLR+2.10% 1 Yr RBLR+2.35%
    Above 75% upto 100% 1 Yr RBLR+1.85% 1 Yr RBLR+2.10%
    Above 100% 1 Yr RBLR+1.35% 1 Yr RBLR+1.85%
    Above 150% 1 Yr RBLR+1.10% 1 Yr RBLR+1.60%
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