PNB Udyog Scheme: MSMEs alert! Eligibility, loan amount, tenure and more - financial help for your business; here is all you need to know

The Punjab National Bank (PNB) is offering financial help and support for businesses. If you are a customer of PNB and want financial assistance for your business then you can avail the benefit under PNB Udyog Scheme. 

The Bank took to its Twitter handle to inform about the same and said,"PNB is there to help you financially for your business. Make your business successful with the help of PNB Udyog Yojana."

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Here is all you need to know about the scheme:

Purpose: To meet the working capital requirement (including Pre and Post Shipment credit) and for acquiring fixed assets like land and factory building, plant and machinery by new enterprises. 

In case of existing units, for expanding factory accommodation, renovating and modernizing the existing factory with a view to improve the quality or reducing production cost, creating additional infrastructure facilities, like setting up of Research and Development Centres / Testing Laboratories, purchase of the vehicle (other than the vehicles meant for personal use) which are required to meet production and marketing needs of the unit etc.

आपके व्यवसाय की वित्तीय सहायता के लिए हाज़िर है पीएनबी।

पीएनबी उद्योग योजना की मदद से आप अपने व्यापार को सफल बनाएं। अधिक जानकारी के लिए क्लिक करें: https://t.co/e1rJPkbV0z#PNBUdyog pic.twitter.com/8wdjscxnha

— Punjab National Bank (@pnbindia) July 12, 2021

Eligibility: Individuals / Partnership / Limited Liability Partnership (LLP) / Pvt. Ltd. Co. / Public Ltd. Co/Trust/ Societies & Cooperative Societies (registered and incorporated under applicable law) and are eligible to be categorized as MSME(s) as defined in the MSMED Act 2006.

MSME enterprises having GST Registration No. (wherever applicable) & Udyog Aadhar Number (desirable).

Type of Facilities: Four type of feacilities atre being provided that is fund based working capital, term loan (for creation of fixed assets / P & M), non fund based limit and composite loans.

Loan limit: Need Based Finance. 

Margin: For stock upto Rs 2.00 lakh no margin is there while for above Rs 2.00 lakh a margin of  25 percent has been kept. For book debt the margin is of 25 percent. For bill for collection of government supply bills the margin is of 10 percent.

For plant and machinery (New) upto Rs 2.00 lakh no margin is there while for above Rs 2.00 lakh margin of 25 percent has been set. For plant and machinery (Old) of age upto 3 years 25 percent margin is there and for above 3 years 30 percent margin is set.

For deferred payment guarantee margin of 25 percent is set, for non- fund based cash margin 15 percent margin is there and for new vehicle for business use 15 percent margin is set.

Tenure of loan: Repayment period shall be maximum of 7 years for Term Loan (including moratorium period). However, extension in repayment period beyond 7 years may be allowed by next higher sanctioning authority on the merit of the proposal. 

However, interest to be serviced during the moratorium period as and when due.

Working capital facility shall be sanctioned for a period of one year and the same shall be renewed on annual basis.

Moratorium Period: It is need based. Maximum upto 12 months. However, extension of moratorium period may be allowed by next higher sanctioning authority on the merit of the proposal.

Primary Security: Hypothecation of Assets that is Stock, Receivables, P & M, Vehicles etc. created out of Bank finance (present and future).

Collateral Security: Advance shall be covered by collaterals covering at least 30 percent of the exposure (FB+NFB). The extent of cash margin (in case of Non fund based limit) over and above 15 percent shall be considered for the computation of collateral coverage.

If the Primary Security is in the shape of Land & Building, residual value over and above 135% of the Term Loan O/s shall be treated as collateral security. Where collateral security is not available, facility should be covered under Credit Guarantee Schemes like CGTMSE/CGSSI as per Bank's Policy guidelines. Personal Guarantee of promoters / directors / Partners/ Trustees/ Members of the society/ etc. as applicable shall be obtained as per Bank's Policy guidelines.

Rate of Interest: As per ROI applicable for MSME Loans.