To provide medium to long term financial assistance for setting up of new, expansion, diversification or modernization projects in various manufacturing or services sector.
The proposed unit for which financial assistance is sought should be located within any of the eight North-Eastern States.
The proceeds of the term loan should be deployed in creation of fixed assets which will ultimately generate revenues for the unit.
Nature of assistance:
The assistance shall be in the form of Rupee Term Loan.
Normally, the Corporation would consider a maximum exposure of upto 12% of its Net worth in a single project. However, actual exposure shall be decided by the sanctioning authority.
In case of consortium lending, the total debt component in the project may be decided by the consortium partners, but the Corporation shall restrict its maximum exposure in the project to 12% of its Net worth and rest of the loan requirement may be sanctioned by other consortium partners.
Minimum of 35 - 40 % of the total project cost. However, in the case of consortium lending the minimum promoter’s contribution shall be as per the collective decision of the consortium partners.
Debt Equity Ratio: Maximum of 1.85 : 1
Prime Lending Rate (PLR) plus maximum spread of 3% per annum.
1% of the loan amount for loans upto Rs.10 crores and 0.75% for loans above Rs.10 crores.
Primary Security: The loan is to be secured by first charge on the assets of the unit unless otherwise stipulated differently by the sanctioning authority.
Collateral Security may be required in deserving cases as may be stipulated by the sanctioning authority.
Repayment of the loan may be spread over 5-8 years excluding moratorium on principal repayment which may be stipulated as per the requirement of the project at the time of sanction.
Documentation : Standard documentation as per the norms of the Corporation.