internal Banner Image

Breadcrumb

indian_bank_about_us_left_menu

Bank’s Profile Vision and Mission Managing Director & CEO’s Profile Executive Director’s Profile Board of Directors Chief General Managers General Managers IMAGE INDIAN BANK MUTUAL FUND

indian_bank_msme_lap

MSME LAP

Apply For Loan
MSME LAP
S.No Particulars Guidelines
1.      Target Group All Micro, Small & Medium Enterprises (MSME) as per extant definition of Government of India with Udyam Registration Certificate.
2.      Eligibility The constitution of Borrower can be Individuals, Proprietorship firm, Partnership firm, LLP, Pvt Ltd. Companies, Ltd Companies, Societies, Trust etc. HUF is not permitted.

Entry Level Age / Exit Level Age of the owner/s of the immovable property offered as security

  • Minimum Entry level Age: 18 years
  • Maximum Exit Level Age: 70 years

New units can also be considered based on realistic projections.
3.      Purpose Any Bonafide business purposes viz.,
  • Business expansion, Improvements / Extension.
  • Purchase of Machineries / Fixed / Movable / Immovable Assets
  • Purchase  / Acquisition / Construction  / Renovation / Built up  / Under Construction of property for Business Purposes.
4.      Facility 4.1. Term Loan

4.2  Overdraft: Dropline OD Facility.
5.      Loan Amount Minimum Loan Amount: Above Rs.10.00 Lakhs

Maximum Loan Amount: Rs.25.00 Crores
6. Margin 40% of the security value. Margin requirement can be relaxed up to 10% by the competent authority.
6.      LTV LTV of 60% shall be ensured throughout the repayment. In case of relaxation in margin cases, LTV of 70% to be ensured.
7.      Assessment Assessment based on security value of EM property (RSV) after deducting stipulated margin and compliance to DSCR and other applicable benchmark ratios.
8.      Security

9.1. Primary Security    : Immovable property proposed to be mortgaged

9.2. Collateral Security : Since the facility is already secured by immovable property, respective sanctioning authority can take decision on requirement of further collateral security on case to case basis.

9.3. The residual life of the building should be at least 5 years more than the proposed repayment period.

9.4. CGTMSE                   : Not applicable

9.5. Personal Guarantee:

  • Personal Guarantee of property owner/s whose security has been considered.
  • Corporate Guarantee of group concern/s which had offered the security.
  • Personal Guarantee of Partners / Directors as per extant guidelines.

9.6. The immovable property offered as security should be SARFAESI Compliant.

9.7. The immovable property offered should be located in Tier I to Tier 4 Centres. Property located in Tier 5 & Tier 6 (i.e. centres with population less than 10000) should not be accepted as security for considering loan under this product. Centres are to be identified as per the latest census available. The latest census currently in use is 2011 census.

9.8. Leasehold Residential / Commercial / Industrial properties allotted by State Government development authorities like MMDA, DDA, CMDA, HUDA, RIICO, HSIIDC etc. wherein residual lease period should not be less than proposed repayment period (door to door) plus 5 years, Lease hold amount is fully paid upfront and with mortgage rights / permission from the lessor can be considered for sanction by respective sanctioning authority.

9.9. The property offered as security can be held by

  • MSME enterprise (applicant) or
  • Proprietor/ Proprietrix, his/her Spouse, Adult Children & Parents or
  • Partners or o Directors / Shareholders (major shareholder i.e., more than 5%) or
  • Group concern/s

9.10. Agricultural properties, disputed properties, properties attached by Tax authorities, Properties belonging to Trusts / HUFs / Societies are not to be considered as security.

9.11. The property held as security for this loan can be extended for other facility / ies sanctioned by our Bank to the applicant concern or group accounts (however only on residual value after ensuring adequate margin for this limit).

9.12. The security should be exclusively charged to our Bank i.e., charge on Pari-passu basis not to be accepted as security

9.13. If Vacant Land is to be considered as security, and there is no deviation in norms of the scheme, the administrative clearance to be obtained from the competent authority.
9.      Repayment Terms

Term Loan :

  • Door to Door     : Maximum 120 Months
  • Holiday period : Maximum 6 Months from the date of disbursement.
  • Repayment period : 114 Months.
  • Competent authority can extend up to 180 Months on case to case basis

OD: Dropline OD facility

  • Equal deduction spread over the tenure of the loan to be made for liquidation of loan at the end of term.
  • Drawing Power to be reduced monthly so as to liquidate the Overdraft at the end of loan period.

Method of Repayment:

  • Principal in equal Monthly Instalments.
  • Equated Monthly Instalments (EMIs).
  • Negotiated repayment of Principal. Interest to be serviced during holiday period.
10.   Rate of Interest

Term Loan :

  • For exposure of Rs.100.00 Lakhs and above

ROI ranging from 8.15% to 8.75% based on Internal rating 

  • For exposure of less than Rs.100.00 Lakhs – 8.75%

OD: Dropline OD facility

  • Additional ROI of 1% will be applicable over and above term loan rate of interest
11. Take over Permitted
  Processing & other charges Refer Services Charges in Indian Bank Website (https://www.indianbank.bank.in) Menu>Rates
  Pre - payment Charges

Individuals & MSEs (with/without co-obligants):

No pre-payment charges on floating rate loans sanctioned/renewed for business purposes, regardless of source of funds (including takeover cases), either partial or full, with no lock-in period.

Medium Enterprises:

Pre-payment charges at 2% + applicable taxes:

• On the prepaid amount for term loans.

• On an amount not exceeding the sanctioned limit for cash credit/overdraft facilities
  Others
  • All securities should be adequately insured with Bank Clause – Premium to be borne by the borrower.
  • Pre-release Audit / Legal Audit are to be conducted as per extant guidelines of Credit Policy.
  • A Declaration from the borrower that the loan amount has been utilized for the purpose/s for which it is sanctioned, to be obtained, to ensure end use of loan.
  • In case of existing securities, where the residual value to be considered, the valuation report should not be fresh valuation and neither it should be more than 3 years old.
  • Bank officials should visit the property and satisfy themselves about the approachability, marketability and value of the property before sanction. The value of the property should be discreetly enquired by the Bank officials and reasonableness of valuation reported by panel valuer should be ensured. A report about this should form part of the appraisal.

 

(Last modified on:Jul 23, 2026 at 06:08:37 am)