Lakshmi Small Business Loan

By : |November 8, 2012 0

BANGALORE, INDIA: Laxmi Vilas bank provides Lakshmi Small Business Loan to support the financial requirements of small businesses. Here is a brief about it:

01. Purpose: For working capital requirements or for purchase of machinery/equipments required for the business.

02. Eligibility: Individuals or Proprietorship concerns engaged in small trade or small business, Commission agents, etc., are eligible for finance under the scheme.

03. Maximum quantum of finance: Rs.. 3.00 lacs

04. Margin: 25% of the value of the primary security.

05. Interest Rate: Base Rate + 3.25% (PER: 14.25% p.a.)

06. Loan Processing fee : 0.25% of the loan amount.

07. Repayment: Repayable in a maximum of 36 EMIs, without any holiday period.

08. Sanctioning Authority: Branch Managers/Heads: Rs.. 3.00 lacs.

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Other Conditions

1. The applicants should be engaged in the business activity in the nearby locality where the branch is situated and should have a satisfactory track record of meeting commitments on time. The distance of the business unit should not be more than 5 KMs to 10 KMs from the branch.

2. The loan should be used for genuine business purposes only.

3. Wherever available, independent market report on the borrower’s means, credit worthiness, etc. should be obtained and verified and kept on record.

4. The Branch Manager should visit the applicant or the business entity/unit before deciding on taking up the credit proposal and the Unit visit report should be kept on record.

5. The drawings in the limits need not be regulated through periodical Drawing Power calculated on the value of the primary security.

6. Interest rate in respect of the limits sanctioned under the scheme is not to be subjected to rating under the Credit Risk Assessment System.

7. The disbursal of the loan under the scheme may be by way of credit to the borrower’s running account or by issue of PO/DD in favour of the supplier of assets financed by the Bank.

8. To ensure prompt repayment Post Dated Cheques covering at least 12 EMIs should be obtained in advance and, thereafter, 12 PDCs in advance every year.

9. Wherever applicable, based on the categorization of the borrower, activity, etc. loans extended under the scheme may be classified under priority sector in tune with the RBI guidelines in the matter.


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