MSME MEET : PPT updated till 24-Sept-2018

Bank of Baroda: An Overview

111 years old Bank With

Pioneer in many Modern & Contemporary
Premier Bank
Customer-Centric Personality
Initiatives in Indian Banking Industry

Steady Domestic &

International Business
Growth

A well & First PSB to receive &

recognized Brand in
Maintain Corporate
Indian banking industry
Governance Rating
(CGR-2) by ICRA Ltd
Wide Range of Technology based
Alternate Delivery Channel Mobile
Banking, Net Banking ATMs, E- Common Technology
Global Integrated
Treasury Operations Lobbies, POS etc. Platform in both Domestic
and overseas operations

2
Bank of Baroda: Key Highlights

1 Strong Government Support

2 Experienced and Professional Management team

3 Pan-India presence with widespread geographical network

4 Strong International presence

5 Adequate Capital Ratios in Excess of Regulatory Requirements

6 Robust Liability Profile

7 Diversified Business and Asset Base

8 Controlled Asset Quality

9 Modern Technology Platform

10 Strong Risk Management Framework and Corporate Governance

Significance of MSMEs –

Network of 51 Million enterprises

Provides employment to 117.1 Million persons contributing 69% of total employment.

Estimated Contribution of almost 30% of GDP with manufacturing and service

segments contributing 6% and 24% respectively.

45% of industrial production and 40% of exports

MSME sector is the growth engine of economy through start ups, entrepreneurship
and innovations.

MSME sector is crucial for the success of national agenda of financial inclusion and
social responsibility.
MSMEs as per MSMED Act. 2006 (Regulatory)
Segment Investment in P&M of Investment in
Manufacturing unit Equipments of
Service Sector
Micro Upto Rs. 25 Lac Upto Rs. 10 Lac
Enterprises

Small Above Rs.25 Lac Above Rs.10 Lac

Enterprises Upto Rs.5.00 Crs. Upto Rs.2.00 Crs.

Medium Above Rs.5.00 Crs. Above Rs.2.00 Crs.

Enterprises Upto Rs.10.00 Crs. Upto Rs.5.00 Crs.
Bank of Baroda is a pioneer in the setting up a specialized
unit for SME’s called Integrated SME Loan Factories/ SME
Loan Factories.

“INTEGRATED SME LOAN FACTORY” is a unique

Business Model adopted by the Bank for SME Segment by
establishing separate Hub for End to End Processing of
SME proposals.

Primarily aims at cutting down the turnaround time.

Presently 39 SME Loan Factories across the country and

Integrated Loan Factories at Mumbai and Delhi to provide
end to end solutions.
New Products & Initiatives under MSME

New Products :
 Baroda Commercial Vehicle Finance
 Vendors’ Bill Discounting for Real Estate Developers
 Baroda Contractors Scheme
 BOB GST Receivables Card for MSME Entrepreneurs
 Baroda E-Business Pack
 Supply Chain Finance
 TReDS
 Baroda Overdraft for E-Commerce Business
 CMR based Rate of Interest
New Products & Initiatives under MSME

Initiatives:
 Integrated SME Loan Factory launched at NCR & Mumbai providing end to end solutions
 Re-alignment of interest rate structure for MSME advances with linkage to security, CIBIL
CMR score etc.
 Score based lending in Govt. Sponsored Schemes with centralization of sanction at district
level
 Dedicated team at SME Loan Factories for keep a check on collection of Loan Installments
 Tie up with SIDBI as a preferred lender for Udyamimitra Portal
 Proactively adopted revised classification for MSME with turnover up to Rs. 250 crores
New Products & Initiatives under MSME

Way Forward:
 Cluster Based Financing
 Shift from Balance Sheet Funding to Cash Flow based Financing
 More Specialized Tailor made products in various sectors such as healthcare, infra etc.
 Strategic tie-ups with various organizations for bulk MSME business
 Capacity Building & Training Programmes
 End to end Loan tracking system and loan lifecycle processing system.
 GST enabled financing
 Centralization of documentation
 Straight through processing (STP), paperless finance for small ticket loans
 BOB GST Receivables Card

Purchases Sales
Supplier Buyer
SP - Rs. 100 SP - Rs. 150
GST @ 28% - Rs. 28 GST @ 5% - Rs. 7.5
Total - Rs. 128 Total - Rs. 157.5
SME Customer

Avail Input Tax Credit

(ITC) – Rs. 7.5 Funding
Unavailed ITC – Rs. 20.5 against eligible
ITC

Repay within
3 months
BANK

© 2017 Bank of Baroda. All Rights Reserved

Objective To provide additional working capital assistance to
customers facing crunch in liquidity arising out of GST
paid on purchase and input tax credit on the same not
yet claimed / eligible for refund.
Eligibility  Existing SME (Regulatory & Non Regulatory) borrowers
dealing satisfactorily with the Bank since past minimum 2
years.
 The account should have not fallen in SMA 1 / SMA 2
category in the last 1 year.
 Minimum CMR Rating up to CMR 5 in case of limits up to
Rs. 10.00 crores. In other cases, minimum BOBRAM
Rating of BOB 5.
 Availing working capital limits of Rs. 25 lacs or above
from our Bank under sole banking arrangement only.
Quantum of Up to 15% of the existing Fund Based Working Capital Limit.
Adhoc Limit The limit shall be over and above the assessed working
capital finance.
 Baroda Contractor Scheme

Target Group: Registered Civil, Construction, Electrical, Mechanical, Mining, Labour &
Transport Contractors / Sub Contractors.

Credit Facilities: Overdraft, Term Loan, Bank Guarantee, Letter of Credit.

Scheme Highlights:
 FBWC on Cash Budget Method
 Scoring based concessions in ROI, LC / BG Commission & Processing Charges
 Top-up Term loan on satisfactory track record of 12 installments
 Term Loan for Second-hand plant and machinery / equipments
 Interchange-ability from FB to NFB limits and vice-versa
 Authority to approve deviation in financial ratios accorded to RO / ZO up to specified levels

© 2017 Bank of Baroda. All Rights Reserved

Objective To provide working capital assistance in the form of
running limit, ILC/FLC, BG for meeting working capital
needs and term loan for purchase of new/ second
hand equipments, office premises to the existing and
prospective contractors / sub contractors.

Eligibility MSME units engaged in contractor / sub contractor

activity and falling within the meaning of Micro, Small
& Medium Enterprises and non regulatory units.

Quantum of Limit Minimum limit: Rs. 10.00 lacs

Maximum limit: Rs. 100.00 crores (FB: Rs. 25.00 Cr & NFB:
Rs. 75.00 Cr).
Purpose  Cater the needs of finance of firms / companies /
undertaking digital as well as non- digital Transactions of
MSME Service sector and Retail Trade units.
 Linkage with POS Machine / Q R Code (Quick Response
Code) / UPI (Unified Payments Interface - app. Based) /
Payment gateways for digital transactions.
Eligibility  Minimum -02- years in existing business activity/ies with
minimum 10% of total sales for last -06- months by way of
digital mode.
 The firm/company must be profit making (Cash Profit) for
the last two years
Type of facility Working capital requirement
Demand / Term Loan for financing capital expenditure.
Limit Maximum up to Rs.5.00 Crs. (Out of which Term Loan Limit
will be maximum up to Rs.1.00 Cr).
 An Introduction to TReDS:
Why TReDS? What is TReDS?
• MSMEs face constraints in obtaining adequate
finance particularly their ability to convert trade • TReDS is a digital exchange to facilitate discounting
receivables in to liquid funds. of the invoice / bills of MSMEs through bidding
process for price discovery.
• Mostly manual processes leading to high • Powerful network effect: Multiple Banks on-board
settlement and operation cost. on platform; but any bank can discount any
corporate’s bill.
• High cost of customer acquisition. • Ensure prompt realisation of trade receivables at
competitive rates without recourse on MSME
• Lack of real time visibility into the transaction. sellers.
• Hassle free documentation – One time Master
• Delay in payments from corporates results in Agreement.
liquidity crunch for MSMEs and subsequently • Digital uploading, accepting, discounting, trading
MSMEs default in meeting their financial and settlement of the invoices / bills of MSME
obligation. Sellers.
• Lower cost of financing to MSMEs as financing
• High cost of finance to MSMEs. based on buyer’s credit worthiness.
RBI approved platforms:
RBI has given approval to following entities to set up and operate Trade Receivables Discounting System (TReDS)
under Payment and Settlement System (PSS) Act 2007:

a) Receivable Exchange of India Ltd (RXIL) – (JV of NSE-SIDBI JV)

b) Mynd Solutions Pvt. Ltd. (M1 Exchange)

c) A.TREDS Ltd (JV of Axis Bank and mjunction)

Bank of Baroda is FIRST PSB in supporting RBI initiative by getting onboarded on all 3 TReDS Platforms
Eligible Participants:

MSME entities as per the Banks, NBFC Factors,

definition of the Micro, Small Financial Institutions and
and Medium Enterprises such other institutions as
Development Act, 2006 may be permitted by RBI
(MSMED Act) from time to time.

Buyers

Corporates and other buyers including

Government Departments and Public
Sector Undertakings and such other
entities as may be permitted by RBI
Leveraging Supply Chain Finance
 Extending Short Term Working Capital finance to DEALERS/ SUPPLIERS (“Spoke”) having
business relationships with LARGE CORPORATE (“Anchor”) to optimise working capital
requirements of both Spoke & Anchor.
 Each finance transaction is linked to a base document (Invoices) between the Anchor & the
Spoke.
Vendor ANCHOR Dealer
(Supplies to Anchor) (Sales to Dealer)

-Target Customers-
Vendor Large Corporates (Anchor) in
:Industry Examples Dealer Finance
Finance 1. Consumer Durable
2. FMCG
3. Auto
4. Pharma
5. Iron & Steel
6. Cement etc
Value Chain Finance

Value Chain Finance refers to:

 working capital finance solutions

 among the various links

 within a value chain

Benefits of Value Chain Based Lending

 Introduce new customer base to the Bank

 More partnerships in value chain segment: Multiplicity of

business relationships.

 Facilitate information flow through various links

 Good visibility & control on the trade cycle

 Stronger monitoring of loans and early warning signals

 Assured end use of funds

Gradual Shift from traditional working capital lending

to value chain based lending – Healthy Loan Book
 Backward Derivative – Value Chain Financing

1st Derivative (Gear

OEM
Handle)
(Eg. Gearbox)
Loans under
Stand Up India /
PMEGP
2nd Derivative
SME Loans
(Moulds Supplier)
BOB
Large Corporate
Covering Entire (E.g. Auto
Corporate Loans
Value Chain Manufacturer)

1st Derivative
(Manufacturing
Sponge) Loans under
SME Loans
PMMY

Dedicated team for

1st Derivative Value Chain Based
(Manufacturing
OEM (Eg.
Lending / Sales set
Leather / PU Seats
up at BCC
Covering) Supplier)
Forward Derivative – Value Chain Financing

Bulk Small / District

Distributor Dealer (1st
Loans under Derivative)
Stand Up India /
PMEGP Covering Entire
SME Loans
Large Corporate BOB Value Chain
(E.g.
Corporate Loans
Pharmaceutical
Retail Chemist (2nd
Co.) Loans under
Derivative)
PMMY

SME Loans Loans under

Dedicated team for Stand up /
Value Chain Based Professional
Lending / Sales set Scheme Clinics (3rd
Logistics / Derivative)
up at BCC Transport
Company
Fintech Initiatives – BOB Ecommerce Finance (Amazon, Snapdeal)

Retail E-Commerce sales in India from 2015 to 2021($ BOB Ecommerce Partners
bn)
E-commerce in India is growing 52
at a breathtaking speed 45
38
31
25 in progress
20 BOB Credit Scoring Module – Validation through Surrogate
16
Data Points

2016 2017 2018 2019 2020 2021 2022 Identification Contactability Intent Ability Stability

Powered
Number of E-Commerce users (mn) by:
338 Digital Underwriting Model
307
273 Parameter Old paradigm Fintech paradigm
240
207 Application Manual Online
177
149 Financing basis Balance sheet Turnover based
TAT 15 days+ 2 days
Type of facility Demand loan Overdraft
Sanction Multiple branch visits 100% online

2016 2017 2018 2019 2020 2021 2022 Cashflow No Control Ring-fenced
Fintech Initiatives - TReDS: Network built Trade Finance platform
SMEs – Access to finance remains woefully inadequate & BOB - 1st Bank to get onboarded on all -3- TReDS platforms
delayed
Particulars (Rs. in lakh crs)  Centralized bidding
Total Debt Demand 26  Two pager appraisal note
for SMEs
 New customer acquisition: Only -3- among -15- TReDS buyers are
Demand met by 14
BOB customers
Banks/ FIs
Unmet Demand 12  Digital uploading, accepting, discounting & settlement of invoices
BoB %age share during March-18: (Amount in Crs)
RBI approved TReDS Platforms Platform Volume BOB % of BOB
Expected volume: Share Share
FY 2017-18 - Rs.1,500 Cr
Myndsol 61.00 14.00 13.08
FY 2018-19 – Rs.12,000 Cr
RXIL 66.00 24.00 13.73
Onboarded Corporates (92) & SME suppliers (348) A.TREDS 118.00 59.00 50.00
Total 245.00 97.00 39.59
Benefits to Bank
 One time master agreement  High quality book in MSME
 Lower cost for New Customer segment.
Acquisition  Paperless & hassle free process
 Reduced operational cost  Priority sector classification
Fintech Initiatives - E-LOANS: Digital lending platform
Total Credit to Household and NPISH* (as % of Proposed digital lending platform – Features
GDP) 89
79
67 71 71
Household debt has 60 Parameter Existing Fintech Paradigm
huge scope for 40 Paradigm
growth 24
10 16 17 Application process Physical Online

KYC checks Manual e-KYC through India

Stack
Credit underwriting Analysis of STP through algorithms
income & bank & alternate data
statements analytics
Proposed digital lending platform – End to end digital
process Partner integration Limited 100+ (plug & play)

TAT 10 days 2 days

Operational cost High 75% reduction

Customer Multiple visits Digital & Door-step

Existing Fintech partnerships for retail lending (HL &
experience
EL)
 Fintech partner for
sourcing housing loan
leads

 For sourcing mortgage

backed Education Loan
applications for overseas
studies.
Key Benefits to Eligible Participants

Benefits to All Participants Benefits to Financiers Benefits to Buyers Benefits to Sellers

• Online digital &
transparent platform
• Paperless and hassle free
process
• Low administrative &
operational cost
• Faster transaction and low
TAT for financing
• Priority sector lending
benefits
• Lower cost for New
Customer Acquisition
• Reduce operational cost
• Opportunity to create a
high quality book in MSME
segment.
• Compliance with MSMED
Act, 2006
• Competitive price
discovery through auction
• Lower supply chain cost for
buyers
• Help efficient cash flow
management
• Alternate and efficient
vendor payment
mechanism
• Ensure stable supplier base
• Competitive price
discovery through auction
• Without recourse to seller
• Lower cost of financing as
financing based on buyer’s
credit profile.
• Immediate payment
against trade receivables
• No follow-ups for payment
• Efficient working capital
management due to
improved liquidity.
SME LF Reorganization - End to End Solutions

HEAD SMELF’s
Head Credit
Head -Sales and Collection
Credit Credit Hubs
Analyst Operations
(New Proposals) Officer
Collection Officer
Relationship
Manager Legal Officer (Already implemented)
Sales Officer
(Existing Business /
Recovery / (Documentation)
Monitoring)

The re-organizations aims to provide:

 End to end solutions (sanction – disbursement – collection) and reduction in TAT
 Better monitoring of accounts.
 Clear cut responsibilities of each desk
 Co-ordinated efforts of the credit, operations, monitoring & collections team.
 Creating sales hubs to focus on outbound sales and target market
Rate of Interest based upon CIBIL CMR Score
ROI Based on CIBIL CMR Ranking and Hard securities for sanction of credit
facilities from Rs. 25.00 lacs upto Rs.5.00 crs.
First Bank in India to rationalize the Pricing based on CIBIL rank.
Rate of interest Ranges as low as MCLR + 0.05% based upon the CMR Rating
ranging from CMR1 to CMR7 & below.
The rate of Interest is derived by a combination of Immovable security coverage
range considered after a pre-specified hair cut and CMR rating matrix.
Eligible immovable securities along with the applied haircut:
Residential property 20% of the Market value
Commercial Property 20% of the Market value
Industrial Property 20% of the Market value
CGTMSE 20% of the Market value
Plant and Machinery 20% of the Market value
COMMERCIAL VEHICLE FINANCE
Segment Description

• Strategic & super strategic • Driver cum Owner

segment segment
• Backed by Contracts • Attaches vehicle with a
• Deployment in Logistics, Car local Transporter
Carriers, Industrial goods • Dependence on Market
• Large Bus operators Load
Strategic First Time
Fleet User/Buyer
Operators (FTU/FTB)

Commercial Vehicle
Retail &
Small
Captive
Transport
Customers
Operator
• Captive users (SRTO)
• Market load Operator
• Used in own business,
factory • Experienced transporter
graduated from FTU
• Widely used are LCVs
• Normally family run
• School/ College buses
business
Customer Segmentation

Category Segment Definition

A First Time Buyer (FTB) Driver cum Owner ; Guarantor backed

customer
B Small Road Transport Operator (SRTO). 1-2 CV Owner
C Retail Fleet Operator. 3-9 CV Owner
D Large Fleet Operators (LFO) 10-25 CV Owner
E Strategic fleet Operators > 25-50 CV Owner
F Super Strategic fleet Operators >50 CV Owner
CAGR 50%
H Captive Customer Captive/Self End Use
I School Bus School bus Funding
Analysis Methodology
Traditional Approach for loan appraisal
Analysis based on past and future Financial
Ratios and Balance Sheet Analysis
Credit Assessment based debt service capability
as per the estimates and projections of revenue
during the tenure of the credit facility.
Collateral based funding
Pricing as per Internal Rating Matrix
Maximum LTV for SME segment is 75%
Proposed Approach for CV Finance
Analysis based upon past financials and
Payment Track record/viability
Credit Assessment through cash flows from the
revenue generations from the fleet of vehicles
Experience based funding
Asset based Funding
Low Delinquency
Pricing based on competitive market scenario
and established scoring model and is as low as
8.50% for strategic customers.
LTV is dynamic based on market competition
 “EXISTING MSME PRODUCTS”

32
SME Short Term Loans
SME Medium Terms Loans
Baroda Vidyasthali Loan
Baroda Professionals
Baroda SME Loan pack
Baroda SME Gold Card
MSME CAPEX Loan/ MSME CAPEX Card
Baroda Arogyadham Loan
Baroda Overdraft against L&B
Financing SME borrowers for purchase of vehicle
Baroda Laghu Udyami Credit Card
Baroda Artisans Credit Card
Baroda Weavers Credit Card
Baroda MSE General Credit Card
Baroda Loan to Business Correspondents
Composite Term Loan Scheme
Baroda E-Business Pack for MSME
PURPOSE To meet temporary shortfall / mismatch in liquidity, for meeting
genuine business requirements.

ELIGIBILITY  MSMEs as per Regulatory/ Expanded Definition of the Bank.

 Satisfactory dealing and Credit rating for last 3 years (BOB-5
& above)
 Satisfactory Financial performance in terms of Sales/
Turnover and Profits

LIMIT 25% of the existing fund based Working capital limits

(depending on the Credit Rating), subject to a minimum of Rs.
10 Lac and maximum of Rs. 250 Lac.
Type of Facility Short Term Loan

Period To be repaid in 12 months including moratorium period

PURPOSE  To augment enterprise’s working capital gap and to help in
improvement of current ratio .
 Other genuine business requirements such as for
repayment of secured and unsecured Loans of other banks
or institutions
ELIGIBILITY  Satisfactory dealings with Bank and credit rating for last 3
years.
 Satisfactory financial performance in terms of sales /
turnover and profits
 D/E Ratio (TOL/TNW) should not be higher than 4.5:1 and
(TTL/TNW) should not be more than 3:1
 Average DSCR should not be less than 1.75:1
LIMIT Upto 25% of the existing fund based Working capital limits
(depending on the Credit Rating), subject to a minimum of Rs.
25 Lac and maximum of Rs. 500 Lac.
Period Not exceeding 36 Months.
PURPOSE  For setting up the education institutions - construction of
building, modernization and renovation etc.
 purchase of instruments meant for imparting education/training.
 Overdraft for meeting short term fund requirements
 Finance for purchase of land alone is not permissible. However
if the last cost is included in the cost of project the same can be
finance (Land Cost should not be more than 20% of the total
project cost and an undertaking to be obtained the building
constructions to be completed within a period of two years)
 Vehicles can be financed under the scheme for the use of the
institutions.
ELIGIBILITY Educational institutions, Schools, Colleges and other education
bodies running education activities (except HUF).

LIMIT Minimum Rs.25 Lac

Maximum Rs.15 crores
MARGIN 25% of the cost of the project.
Type of Facility Overdraft, Term Loan
PERIOD Maximum 84 months including moratorium period upto 2 year,
depending upon the projected cash flow.
FACILITY Term Loan / Demand Loan / Cash Credit and NFB Limits
PURPOSE Working Capital, Purchase of equipments, Expanding / Renovating
Business premises & NFB (BG / LC) facilities
ELIGIBILITY Professionals in any discipline viz. Engineers, Architects, Interior
Designers, Photographers, Financial Consultants (CA/ICWA/CS),
Advocates, Dentists and specialized qualified service providers.

Proprietorship / Partnership / Pvt / Public Ltd companies with:

 Minimum ITR – taxable income of 1 Lac
 Minimum experience of 3 years in their respective fields
 Minimum CIBIL / Bureau score of 760

LIMIT Minimum Rs. 10.00 Lac & Maximum Rs. 5.00 crores.

MARGIN 25% on Stocks and Book Debts

25% to 35% on Land and Plant & Machinery
20% minimum for guarantee and LC facility
PERIOD  12 months for Working Capital Facilities.
 Maximum 84 installments including moratorium period.
Interest to be served every month.
“Baroda SME Loan Pack” provides single line of credit for meeting SME borrowers’
working capital as well as long term requirements within the overall limit approved by
the bank.
PURPOSE To provide hassle free credit for working capital (fund based and non-
fund based) as also capital expenditure related to the business of the
borrower within the overall composite limit sanctioned to the
borrower.
ELIGIBILITY SMEs as per Regulatory and Expanded Definition of the Bank.
Borrower to exclusively to deal with BOB
COMPOSITE LIMIT 4.5 times of borrower’s tangible net worth as per last audited
Balance Sheet or Rs. 10.00 Crores, whichever is lower.
MARGIN 25% of all the facilities
Facility Fund based (short Term and Long Term) / non-fund based
facility within the overall composite limit
PERIOD  12 months in case of WC.
 Maximum period Upto 7 years. for TL
Purpose To meet emergent requirements and tie up temporary mismatch
in liquidity arising out of delayed payment by buyers, tax
payment, etc.
Eligibility All Micro, Small and Medium Enterprises (REGULATORY)
fulfilling following criteria:
 A/c in Standard Category for last 2 years
 Obligor credit rating of BOB-5 and above
 Working Capital limits of Rs. 25/- Lac and above.
 Sole Banking arrangement with our Bank.
 No deviation allowed in Take-over accounts
Limit 10% of assessed MPBF
Type of Facility Working Capital ( Overdraft)
PERIOD 12 months to be allowed on 4 occasions during the year for a
maximum period of 2 months on each occasion with a minimum
gap of 15 days between two drawals.
PURPOSE To meet the Capital Expenditure requirements related with the regular
business activities e.g. Replacement of Old Machinery, Modernization,
Investment in R&D, Purchase of Cars, passenger cars for staff and other
vehicles for business purpose.
ELIGIBILITY  SMEs as per Regulatory & Expanded Definition of the Bank.
 Satisfactory Credit rating (BOB-5 & above)
 The Manufacturing / Service sector unit should have been established in
the line of activity for a minimum period of two years.
 No adverse features are reported in conduct of account
LIMIT  25% of gross block of Plant and Machinery for MSME (Mfg) as per last Audited
Balance Sheet or
 10% of the working capital for service sector based on DSCR and subject to cap:
 Baroda MSME Capex Card: Min 25.00 Lac and Max 5.00 crores
 Baroda MSME Capex Loan: Min 25.00 Lac and Max 2.00 crores
 Average Gross DSCR inclusive of the repayment liability under proposed Capex
Loan should not be less than 1.75. In any year it should not be less than 1 for MSE
borrowers and 1.25 for Medium & SME Expanded Borrowers.
 Fund based and non fund based limits does not exceed the overall limit.
Type of facility Term Loan
Period 3 to 7 years including Moratorium Period
PURPOSE  For setting up of new Nursing Home/Hospital including
Pathological Laboratory, Diagnostic Centers.
 Expansion/renovation/ modernization of existing Nursing
Home/ Hospital including Pathological Laboratory, Diagnostic
Centers.
 Purchase of medical diagnostic equipments as also office
equipments, viz. computers, air conditioners, office furniture,
etc.
 Purchase of ambulance.
 To meet working capital requirement.
 Construction of rest house, staff quarters
ELIGIBILITY SMEs as per Regulatory and Expanded definition.

Note: The Promoters should have requisite qualification in any

branch of medical science from a recognized University and
should have minimum 2 years of work experience.
LIMIT  Rural Centres - Rs. 0.50 crores
 Semi-Urban Centres - Rs. 6.00 crores
 Urban Centres - Rs. 12.00 crores
 Metro Centres – Rs.15.00 crores
MARGIN Uniform 25%.
Higher margin if collaterals are inadequate

PERIOD Demand Loan / Term Loan

35 months to 84 months including moratorium subject to annual
review

Note: Repayment period to be decided on project cash flow

PURPOSE To meet fund based working capital requirement
LIMIT Minimum : Above Rs. 10.00 Lac
Maximum : Rs. 100.00 Lac- Rural,
Rs. 500.00 Lac-Semi Urban and
Rs.1000.00 Lac– Urban & Metro
Note: Facility will be allowed by way of Overdraft.
However, sanctioning authority may allow non-fund based
working capital facilities viz LC & BG by earmarking the Overdraft Limit

Period 12 months
Eligibility  SME as per Regulatory / expanded definition

 SME in line of business for a minimum period of -2- years with a sole

banking arrangements.
Nature of OD against Land & Building belonging to unit or promoters of the unit or
facility close relatives of the promoters, viz father, Mother , Spouse, Son, Son’s
wife Daughter, Daughters husband, Brother, Brother’s wife, Sister, Sisters
husband only provided they stand as guarantor)
Property in the name of HUF not allowed.
Retail Trade and Real Estate Sector not eligible under the Scheme
ELIGIBILITY: Units eligible to be classified as MSME as per
MSMED Act 2006 (Regulatory MSME)

PURPOSE: Fixed capital investment and / or working capital

requirement.
TYPE OF Composite Term Loan
FACILITY
AMOUNT OF Up to Rs.100 Lac
LOAN
MARGIN Nil in case of composite loan up to Rs 25,000/-
15% - 25% in case of composite loan above
25,000/- and upto Rs100/- Lac

Period of Minimum 3 years and Maximum 10 years with

repayment initial holiday of 12 months to 18 months, both for
interest and principal.
 “STAND UP INDIA”

45
“Stand up India” was launched by our Hon’ble Prime Minister on 5th
April , 2016
Motto:
To provide credit facility to SC/ST and/or Women Entrepreneur.
Bank loans between Rs.10/- Lac and Rs.100/- Lac for setting up a
Greenfield Enterprise.
This enterprise may be in manufacturing, services or the trading
sector.
In case of non-individual enterprises at least 51% of the
shareholding and controlling stake should be held by either an
SC/ST or Woman entrepreneur.
To create an eco system which facilitates and continues to provide a
supportive environment for doing business
Eligibility:

SC/ST and/or woman entrepreneurs, above 18 years of age.

Loans under the scheme is available for only green field project.
Green field signifies, in this context, the first time venture of the
beneficiary in the manufacturing or services or trading sector.
In case of non-individual enterprises, 51% of the shareholding
and controlling stake should be held by either SC/ST and/or
Women Entrepreneur.
Borrower should not be in default to any bank/financial institution.
 Pradhan Mantri Mudra Yojana
(PMMY)

48
Action by GOI :
Hon’ble Prime Minister on 8th April, 2015 launched PMMY

“Pradhan Mantri MUDRA Yojana“ (PMMY).

Motto:
To “ fund the unfunded”
To bring such enterprises to the formal financial system
To extend affordable credit .

Potential :
As per NSSO (National Sample Survey Organization) estimate about
5.77 crores smaller of the micro units engaged in manufacturing,
trading and service sector , exist in the country.
Majority of them are outside the formal banking fold .
They are unable to sustain or grow due to lack of finance or relying on
informal channels, which are very expensive or unreliable.
Eligibility:
 All “Non farm enterprises” (Now with effect from 01.04.2016, Agri allied activities
also included in MUDRA loans)
 under “Micro Enterprises” and “Small Enterprises” segment
 engaged in “income generating activities”
 engaged in “manufacturing, trading and services “ and
 whose “credit needs are up to Rs.10/- Lac”

Target group:
 Retail Traders: Pan shop, vegetable vendors, Kirana Merchants etc.,
 Entrepreneurs engaged in Agriculture allied activities like Dairy, Horticulture, Floriculture,
Piggeries etc
 Professional & self employed persons: Persons undertaking various services like
Mechanics, fabricators, Tailors, all service providers etc.,
 Small borrowers like Shoe repairers, Tent house hirers
 Road Transport operators : Cart pullers, Cycle Rickshaw, Auto and taxi operators, etc.
Credit Facilities:
 Any type of Fund Based : for Working Capital requirement and Financing
Capital Expenditure
 No Minimum amount. Maximum Amount Rs.10.00 Lac.
Objective of the Scheme
 To target these segments of the people into Banking financial system.
 In all categories of areas i.e. Rural, Semi Urban, Urban or Metros.
 Satisfying the “Eligibility criteria” and
 Duly ensuring “all KYC diligences “
Categorization of Mudra Loans:

Category Stipulated Credit limits

SHISHU Loans sanctioned under the scheme up to Rs.50,000/-

KISHORE Loans sanctioned under the scheme from Rs.50,001/- to Rs.5.00 Lac
TARUN Loans sanctioned under the scheme above Rs.5.00 Lac to Rs.10.00 Lac
Thank You