ACCEPTANCE OF COLLATERAL SECURITY-REVISED NORMS

With effect from 9/1/2012

The norms for acceptance of collateral security while considering sanction of term loans.

§ In respect of immovable property situated in the Union Territory of Puducherry the value of the property to be offered shall be not less than the amount of term loan sanctioned.

§ In respect of immovable property situated outside the Union Territory of Puducherry the value of the property to be offered shall be not less than 150% of loan amount in case of land with building. In case the property to be offered is only land the value of the same shall be not less than 200% of the loan amount.

§ The valuation of the properties be assessed by engaging Approved Independent Valuers for the properties lying outside Union Territory of Pondicherry and

The practice of accepting Fixed Deposit as collateral security be dispensed with.

Rate of Interest - New

All Sanctions from 01/02/2012 the following rate of interest be adopted.

Sl.No.	Term loans and working capital loans	Interest p.a. (%)
A	Upto Rs.25.00 lakhs	13%
B	Above Rs.25.00 lakhs and upto Rs.50.00 lakhs	14%
C	Above Rs.50.00 lakhs and Term loan to MSI	15%

In respect of all sanctions already made but no disbursement is made the above revised rates be made applicable.

Investigation fees

Collection of investigation fees the same be collected at the following rates with effect from 01/02/2012.

Sl.No.	Loan Amount	Investigation fees (%)
a	For loans upto Rs.25.00 lakhs	0.50% of the term loan applied plus service tax as applicable.
b	For loans above Rs.25.00 lakhs	0.75% of the term loan applied plus service tax as applicable.
c	For SC/ST entrepreneurs	50% concession on investigation fee.

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