Objective : To provide financial assistance for acquiring specific machinery/equipment by financially sound and profit making companies having good credit record.
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.
Financially sound companies
Should be in the operation for a period of 5 years and should be making profit for the last three years.
Must have a good credit track record.
Exclusion : Assistance under the scheme will not be available for the following:
Acquisition of second hand equipment/machinery
In- house fabrication of equipment/ machinery
Reimbursement of the cost of equipment/ machinery purchased more than 90 days prior to the date of application.
Grass root projects or major/ expansion/ diversification, which call for detailed appraisal.
Nature of assistance: Rupee Term Loan
Extent of Assistance:
Maximum 70% of cost of equipment plus taxes/duties, transportation and installation charges.
Minimum: Rs.25 lakh
Maximum: Rs.10 Crores
Promoters’ contribution: Minimum of 30% of the cost of equipment proposed to be acquired.
Debt Equity Ratio: Maximum 2.33 : 1
Interest Rate: Prime Lending Rate (PLR) plus maximum spread of 3% per annum.
Up-front fee: 1% of the loan amount.
Primary Security: The loan is to be secured by first charge on the assets of the unit or as stipulated by the sanctioning authority. In case the existing assets are charged to another bank, then the charge shall be created on a pari-passu basis.
Repayment period: Upto a maximum of 6 years including moratorium or as stipulated by the sanctioning authority.
Collateral Security: Collateral Security may be required in deserving cases as may be stipulated by the sanctioning authority.
Documentation : Standard documentation as per the norms of the Corporation.