Small & Medium Enterprises Strategic Business Unit

SMALL & MEDIUM ENTERPRISES STRATEGIC BUSINESS UNIT

All the interest rates are linked to Base Rate (floating) which is 10.20% w.e.f. 20.01..2014. Please note that irrespective of the category of the borrower (i.e. micro, small, medium and other non-regulatory / Sankalp SME) the rate of interest will be as per the limit proposed and credit rating assigned. The applicable rating models are :

Sr No / Limits (Rs.) / Applicable rating Model
Presently in force
From / To
1 / 1 / < 10 Lakh / No rating
2 / 10 Lakh / < 5 Crore / SBS
3 / 5 Crore / <30 Crore / MS
4 / 30 Crore and above / HLC

Please also note importantly that ‘Tenor Premium’ is to be added to the interest rates for all term loans with limits of above Rs.10 lacs with repayment period exceeding 1 year (door to door).

REGULATORY MSME ( As per MSMED Act 2006) will include the followings:

Category of / Amount of Original Investment
Enterprise / Investment in Plant & Machinery in case of units
engaged in Manufacturing /
preservation of goods
(including Processing Units) / Investment in Equipment in case of units engaged in providing /rendering services
Micro Enterprise / Not to exceed Rs.25 Lakh / Not to exceed Rs.10 Lakh
Small Enterprise / More than Rs.25 Lakh but not exceeding Rs.5 Crores / More than Rs.10 Lakh but not exceeding Rs.2 Crore
Medium Enterprise / More than Rs.5 Crore but not exceeding Rs.10 Crores / More than Rs.2 Crore but not exceeding Rs.5 Crore

RATES OF INTEREST FOR MSME ACCOUNTS

MICRO ENTERPRISES

TABLE A: For limits below Rs.10 Lakh

SANCTIONED LIMIT / EXISTING / PROPOSED
UP TO 50000 / 10.25 / 10.20
50000 TO < 2 LAKH / 11.25 / 11.20
2 LAKH TO 5 LAKH / 12.25 / 12.20
5 LAKH TO 10 LAKH / 12.25 / 12.20

TABLE A-I: Limits from Rs.10 Lakh TO Rs.1 Crore

CR. RATING / EXISTING / PROPOSED
SBS1 / 12.85 / 12.80
SBS2 / 12.85 / 12.80
SBS3 / 12.90 / 12.85
SBS4 / 12.90 / 12.85
SBS5 / 13.15 / 13.10
SBS6 / 13.45 / 13.40
SBS7 / 13.95 / 13.90
SBS8 / 15.50 / 15.45
SBS9 / 15.50 / 15.45
SBS10 / 15.50 / 15.45

TABLE A-II: Rs. I CRORE TO < Rs 5 Crore

CREDIT RATING / EXISTING / PROPOSED
SBS-1 to 2 / 13.35 / 13.30
SBS-3 / 13.40 / 13.35
SBS-4 / 13.90 / 13.85
SBS-5 / 14.40 / 14.35
SBS-6 / 14.45 / 14.40
SBS-7 / 14.45 / 14.40
SBS-8 to 10 / 15.50 / 15.45

Note:

For credit limits of Rs.5 Crores and above to Micro Enterprises where MS rating is applicable, Rate of Interest will be as per Table B-I and B-II ( as applicable to Small Enterprises).

SMALL ENTERPRISES

TABLE B:Limits <Rs.10 Lakhs(Small Enterprise)

SANCTIONED LIMIT / EXISTING / PROPOSED
50000 / 10.75 / 10.70
50000 TO 2 Lakh / 11.75 / 11.70
2 Lakh TO 10 Lakh / 12.75 / 12.70

TABLE B-1: Limits Rs.10 Lakh to < Rs. 10 Crore (Small Enterprise)

CREDIT RATING / 10 Lakh to <1 Crore / 1 Crore to < 5 Crore / 5 Crore to <10 Crore
Existing / Proposed / Existing / Proposed / Existing / Proposed
MS1 / 13.35 / 13.30
MS2 / 13.60 / 13.55
MS3 / 13.90 / 13.85
MS4 / 14.40 / 14.35
MS5 / 14.65 / 14.60
MS6 / 14.95 / 14.90
MS7 / 15.45 / 15.40
MS8 / 15.50 / 15.45
MS9 / 15.50 / 15.45
MS10 / 15.50 / 15.45
SBS1 / 13.85 / 13.80 / 13.35 / 13.30
SBS2 / 13.85 / 13.80 / 13.35 / 13.30
SBS3 / 13.90 / 13.85 / 13.40 / 13.35
SBS4 / 13.90 / 13.85 / 13.90 / 13.85
SBS5 / 14.15 / 14.10 / 14.40 / 14.35
SBS6 / 14.45 / 14.40 / 14.45 / 14.40
SBS7 / 14.95 / 14.90 / 14.45 / 14.40
SBS8 / 15.50 / 15.45 / 15.50 / 15.45
SBS9 / 15.50 / 15.45 / 15.50 / 15.45
SBS10 / 15.50 / 15.45 / 15.50 / 15.45

TABLE B-II: Limits Rs.10 Crore and above (Small Enterprise)

CREDIT RATING / 10 Crore to < 30 Crore / 30Crore and above
Existing / Proposed / Existing / Proposed
MS-1 / 13.35 / 13.30
MS2 / 13.60 / 13.55
MS3 / 13.90 / 13.85
MS4 / 14.15 / 14.10
MS5 / 14.40 / 14.35
MS6 / 14.95 / 14.90
MS7 / 15.20 / 15.15
MS8 / 15.50 / 15.45
MS9 / 15.50 / 15.45
MS10 / 15.50 / 15.45
HLC1 / 13.35 / 13.30
HLC2 / 13.60 / 13.55
HLC3 / 13.90 / 13.85
HLC4 / 14.15 / 14.10
HLC5 / 14.40 / 14.35
HLC6 / 14.95 / 14.90
HLC7 / 15.20 / 15.15
HLC8 / 15.50 / 15.45
HLC9 / 15.50 / 15.45
HLC10 / 15.50 / 15.45

MEDIUM ENTERPRISES:

TABLE C:Limits <Rs.10 Lakh (Medium Enterprise)

SANCTIONED LIMIT / EXISTING / PROPOSED
UP TO 50000 / 10.75 / 10.70
50000 to < 2 LAKH / 11.75 / 11.70
2 LAKH TO 10 LAKH / 12.75 / 12.70

TABLE C-1: Limits Rs.10 Lakh to < Rs. 10 Crore (Medium Enterprise)

CREDIT RATING / 10 Lakh to <1Crore / 1 Crore to <5 Crore / 5 Crore to <10 Crore
Existing / Proposed / Existing / Proposed / Existing / Proposed
MS1 / 12.85 / 12.80
MS2 / 13.10 / 13.05
MS3 / 13.40 / 13.35
MS4 / 13.65 / 13.60
MS5 / 13.90 / 13.85
MS6 / 14.45 / 14.40
MS7 / 14.95 / 14.90
MS8 / 15.50 / 15.45
MS9 / 15.50 / 15.45
MS10 / 15.50 / 15.45
SBS1 / 13.10 / 13.05 / 12.60 / 12.55
SBS2 / 13.35 / 13.30 / 12.85 / 12.80
SBS3 / 13.40 / 13.35 / 13.15 / 13.10
SBS4 / 13.40 / 13.35 / 13.15 / 13.10
SBS5 / 13.65 / 13.60 / 13.65 / 13.60
SBS6 / 13.95 / 13.90 / 13.95 / 13.90
SBS7 / 14.20 / 14.15 / 13.95 / 13.90
SBS8 / 15.50 / 15.45 / 15.50 / 15.45
SBS9 / 15.50 / 15.45 / 15.50 / 15.45
SBS10 / 15.50 / 15.45 / 15.50 / 15.45

TABLE C-II: ABOVE 10 CRORE (Medium Enterprise)

CREDIT RATING / 10 Crore to <30 Crore / 30 Crore and above
Existing / Proposed / Existing / Proposed
MS1 / 12.85 / 12.80
MS2 / 13.10 / 13.05
MS3 / 13.40 / 13.35
MS4 / 13.65 / 13.60
MS5 / 13.90 / 13.85
MS6 / 14.20 / 14.15
MS7 / 14.45 / 14.40
MS8 / 15.00 / 14.95
MS9 / 15.50 / 15.45
MS10 / 15.50 / 15.45
HLC1 / 12.60 / 12.55
HLC2 / 13.10 / 13.05
HLC3 / 13.40 / 13.35
HLC4 / 13.40 / 13.35
HLC5 / 13.40 / 13.35
HLC6 / 13.95 / 13.90
HLC7 / 14.45 / 14.40
HLC8 / 15.00 / 14.95
HLC9 / 15.50 / 15.45
HLC10 / 15.50 / 15.45

RETAIL TRADE :

Interms of RBI Circular No:RPCD:CO/PLAN/BC-37/04.09.01/2012-13 dated 17TH Oct. 2012,Section1.1(b) definition of Enterprises engaged in providing or rendering of services among others include Retail Trade, subject to meeting original cost of investment in equipment as notified under MSMED Act,2006.All sanctions up to Rs.500 lac for Retail Trade will be classified under priority sector lending.

Hence finance under Retail Trade will be classified as Micro/Small/Medium/others depending on original investment in equipment as clarified in page 1 of this annexure and ROI will be charged accordingly.

It may be clarified that Finance to wholesale Traders will continue to be treated as Non-Regulatory/Other sector.

TABLE – D: STAR CHANNEL CREDIT

Supplier Credit:

Sponsoring
Corporates
Credit rating / Tenor of Credit
Upto and inclusive of 90 days / > 90 days and upto and inclusive of 180 days / > 180 days and upto and inclusive of 270 days / Beyond 270 days
AAA (SBS / MS / HLC- 1 to 3) / 12.45 % p.a. / 13.20 % p.a. / 15.20%
p.a / 15.20 % p.a.
AA (SBS / MS / HLC- 4 to 6) / 12.95%
p.a. / 13.70%
p.a. / 15.20
% p.a. / 15.20
% p.a.

Dealer Finance:

Normal Rates of interest based on credit limits /rating are to be charged.

Concessions:

Wherever Guarantee of the Sponsoring Corporate is obtained in respect of repayment of dues of the Dealers to the Bank:

Rating of
Sponsoring
Corporate / Applicable Rate / Minimum Floor Rate
AAA (SBS / MS / HLC- 1 to 3) / 0.50% below the rate for which the Sponsoring Corporate is eligible for W/C Finance against Book Debts. / 12.45%
AA (SBS / MS / HLC- 4 to 6) / 0.25% below the rate for which the Sponsoring Corporate is eligible for W/C Finance against Book Debts / 12.95%

Notes:- I-The above two concessions in pricing are available for credit by way Drawee Bill Finance with the tenor of bills not exceeding 180 days only.

TABLE-E(i) DHANVANTARI SUVIDHA SCHEME

SANCTIONED LIMIT / EXISTING / PROPOSED
UP TO 50000 / 10.25 / 10.20
50000 to < 2 Lakh / 11.25 / 11.20
2 Lakh to <10 Lakh / 12.25 / 12.20
10 Lakh up to 50 Lakh / As per Credit rating and segment (Micro, Small or Medium) / As per Credit rating and segment (Micro, Small or Medium)

No other concession in interest to be allowed for limits up to Rs10.00 lakh.

(ii) BOI STAR DOCTORS PLUS SCHEME (SME Segment)

Type / Existing / Proposed
Term loan up to 5 years / 11.75 / 11.70*
Term Loan above 5 years / 12.00 / 11.95*
Vehicle loan / 11.75 **ht above O : g report. Details : NBGLCC) and 1985 with satisfactory conduct. Other group concerns are also working wi / 11.70*
WC (Clean) / 12.00 / 11.95

*Including tenor premium.

TABLE- F:Star Laghu Udyami Samekit Loan/Star MSE Demand/Term Loan

Limit / Existing / Proposed
Up to Rs.50,000/- / 10.25 / 10.20
Above Rs.50,000/- up to Rs.5,00,000/- / 11.25 / 11.20
Above Rs.5,00,000/- upto below Rs.10,00,000/- / 12.25 / 12.20
Rs.10,00,000/- and above upto Rs.100,00,000/- / 13.00 / 12.95

Notes:

Concession of 0.50% in ROI on account of CGTMSE guarantee cover has already been factored.
No other concession including those meant for Priyadarshini, SME rating etc., to be extended to the accounts under this scheme.
No further account specific concession to be considered.

TABLE-G: Small Road & Water Transport Operators

SRWTO accounts have been exempted from credit rating for limits up to and including Rs.100 lacs and uniform rate of interest was introduced for all SRWTO borrowers with limits up to and including Rs.100 lacs vide HOBC: 103/5 dt. 09-04-2009. These provisions will continue. It will now stand linked to base rate. Interest rate schedule for SRWTO is reproduced below for your ready reference.

Limits / Interest rates (floating) / Linked to Base Rate
Upto 50000 / 10.20% / At Base Rate
50000 up to 2 lacs / 11.20% / 1.00% above Base Rate
2 lacs up to 10 lacs / 12.70% / 2.50% above Base Rate
10 lacs up to 50 lacs / 13.70% / 3.50% above Base Rate
Rs. 50 lacs up to Rs. 100 lacs / 14.20% / 4.00% above Base Rate

Concession of 0.50% will be available for limits exceeding Rs.2 lacs and up to Rs.100 lacs if the account is covered under CGTMSE guarantee. No other concession including those meant for Priyadarshini, SME rating etc. to be extended to the accounts under SRWTO scheme as the rates prescribed are rationalized.

TABLE- H:Special Scheme for Financing SRTOs /Equipment Hirers under MOU with OEMs. ( Branch Circular NO:107/90 dated 19.08.2013).

Limits / Interest Rate (Floating) / % linked to Base rate
Upto Rs.2.00 lacs / 10.20% / At Base Rate
Rs.2 lacs up to Rs.20 lacs / 11.70% / 1.50% over Base Rate
>Rs.20 lacs up to Rs.50 lacs / 12.20% / 2.00% over Base Rate
Rs.50 lacs up to Rs.100 lacs / 13.20% / 3.00% over Base Rate
Fleet owners- Limits Rs.100 lacs. / 12.70% / 2.50% over Base rate

No concessions to be extended on account of CGTMSE cover, Priyadarshini or SME rating as the rates are already rationalized.

Presently Our bank has tie up arrangement with the following 13 OEMs with whom we have entered in to MOU.

1.Piaggio Vehicles P Ltd.

2.Tata Motors Ltd.

3.Asia Motor works Ltd.

4.JCB India Ltd.

5.Mahindra Trucks and Buses Ltd.(Previously Mahindra Navistar automotives Ltd.)

6.Bajaj Auto Ltd.

7.Ashok Leyland Ltd.

8.Maruti Suzuki India ltd.

9.TVS Motors Ltd.

10.Mahindra and Mahindra ltd.

11.VE commercial vehicles ltd.

12.Force Motors Ltd.

13.Atul Auto ltd.

Please note that for financing vehicles of companies with whom we have not entered in to MOU, the ROI as mentioned under Small Road and Water Transport Operators above will be applicable.

TABLE I: BOI STAR VYAPAR SCHEME:

Market value of security(in %) / Existing / Proposed
110%-149% / BR+2.50% i.e 12.75% / 12.70%
150%-175% / BR+2.25% i.e12.50% / 12.45%
More than 175% / BR+2.00% i.e12.25% / 12.20%

As the ROI is already rationalized, no other concessions i.e SME Ratings,Priyadarshini scheme to be extended.

Star Laghu Udyog Suvidha Scheme (Temporary Liquidity Support for AAA(SBS / MS / HLC- 1 to 3) and AA(SBS / MS / HLC- 4 to 6) rated SSI units)

In respect of the above short term loan facility, concession of 1.50% on the rate applicable as per credit rating of the account will be available.No other concession including those meant for Priyadarshini, SME rating etc., to be extended to the accounts under this scheme. If the liability under the scheme is not liquidated within 180 days, normal interest plus 2% penal interest will be levied ab initio.

Loan for Tax Return Preparers (TRP)

Same ROI as applicable to Micro Enterprises given in Table A

NOTES:

All Existing and New Micro & Small enterprises accounts with limit up to Rs.100 lacs and covered under CGTMSE Guarantee will be eligible for a concession of 0.50% on the applicable rate. In respect of accounts rated by any of the following Credit Rating Agencies viz., SMERA, ONICRA, Dun & Bradstreet, CRISIL, CARE, ICRA, FITCH, Brickwork Ratings India concessions in rate of interest to the extent of 0.50% in respect of units obtaining the highest and 2nd highest ratings and to the extent of 0.25% in respect of units obtaining third highest rating are being allowed at present. This will continue unchanged unless otherwise restricted.
In respect of women beneficiaries financed under Priyadarshini Yojana for various purposes, 0.50% less than the applicable rates for limits up to Rs.50000/- and 1% less than applicable rates for limits above Rs.50000/- is being levied. This will continue unchanged unless otherwise restricted.

An account may attract more than one concession in the rate of interest on above three counts. For instance, an account with a limit of Rs.100 lacs covered under CGTMSE, with rating by any of the SME rating agency and the firm is owned and run by women entrepreneur/s will attract multiple concessions viz., 0.50% for CGTMSE cover, 0.50% to 1.00% under Priyadarshini Scheme, 0.25% to 0.50% for SME rating etc. In such cases concession on rate of interest on all such counts put together should not exceed 1.50%.
Schematic loans will not be eligible for any of the general concessions mentioned above as the interest rates and concessions specified underneath the schemes have been rationalized taking into account various factors attracting concessions.
Tenor premium is introduced for term loans with limits above Rs.10 lacs which are as per the following table. This premium is to be added to the interest rates given for various slabs of limits under various segments such as Micro, Small & Medium.

Tenor / Premium
Above 1 Year-Up to 7 Years / 0.50% p.a.
Above 7 years / 0.75%p.a.

In the case of term loans to Micro and Small Enterprises borrowers with limits above Rs.10 lacs and up to Rs.100 lacs, additional concession in ROI equivalent to the applicable tenor premium is to be extended. The cap on maximum concession of 1.50% in ROI as mentioned in Note (3) above will not apply to the aforesaid additional concession.

It may be clarified that Tenor premium as above will become applicable only in the following cases:

a)Micro and Small Enterprises: If the limits are more than Rs.100.00 lacs.

b)Medium Enterprises: All accounts with limits of above Rs.10.00 lacs.

Rate of Interest to be charged with or without concessions is subject to the floor of base rate which is presently 10.20% p.a.
For determining the limit slab under which the account will fall, the aggregate exposure on account of both Fund Based Limit & Non Fund Based Limit should be considered.
In terms of our HOBC 107 / 163 dated 22.11.13 on Delegation of Powers, ZLCC & NBGLCCs are authorized to approve Interest Rate concession upto 1% & 2% respectively subject to carrying out cost benefit analysis

and spelling out justification for the same in the proposal . It is applicable for accounts under MSME segment also. Needless to add that this concessionary power must be exercised with great discrimination and circumspection; concession must be the exception rather than the rule. Higher authorities are empowered to approve higher concessions in ROI as stated in the aforesaid circular. In such cases concessions as mentioned in para 3 above i.e due to CGTMSE cover,Credit Rating,Women beneficiary etc. if not already factored/considered, will be permissible additionally subject to cap of 1.50% concession.

To encourage cluster financing, Bank has allowed concession in ROI to various cluster based schemes. ROI in these cases is linked to Base Rate. Consequent upon decrease of Base Rate by 0.05% w.e.f. 20.01.2014, the rates in case of cluster finance linked to base rate are to be decreased by 0.05% , if otherwise not restricted.

NON-REGULATORY SME: To cover accounts:

where the original investment in plant and machinery is more than Rs.10.00 Crores in respect of Manufacturing units and investment in equipment is more than Rs.5.00 Crores. in respect of service units.

RATE OF INTERESTNON-REGULATORY SME

TABLE-A:Limits upto Rs. 10 lac

WC/STL 14.20%

TL 15.45%

TABLE- B:Limits from Rs 10 lac up to less than Rs.30.00 Crore depending on Credit Rating.

Rate of interest depending upon ratings in % p.a.
Rating=> LIMIT / SBS
1 / SBS
2 / SBS
3 / SBS
4 / SBS
5 / SBS
6 / SBS
7 / SBS
8 / SBS
9 / SBS
10
10 lac to 1 Cr / 13.55 / 13.80 / 14.10 / 14.35 / 14.60 / 15.40 / 15.40 / 15.95 / 16.45 / 16.45
1 Crore to< 5 Cr / 13.30 / 13.55 / 14.10 / 14.35 / 14.60 / 15.40 / 15.40 / 15.95 / 16.45 / 16.45
Rating=> / MS-1 / MS-2 / MS-3 / MS-4 / MS-5 / MS-6 / MS-7 / MS-8 / MS-9 / MS-10
5 Crore to < 10 Cr / 13.30 / 13.55 / 13.85 / 14.10 / 14.60 / 15.40 / 15.90 / 15.95 / 16.45 / 16.45
10 Crore to < 30 Cr / 13.30 / 13.55 / 13.85 / 14.10 / 14.35 / 15.40 / 15.90 / 15.95 / 16.45 / 16.45

TABLE-C:Limits of Rs.30.00 Crore and above:

Rate of interest depending upon ratings in % p.a.
Turnover / EC1 / EC2 / EC3 / EC4 / EC5 / EC6 / EC7 / EC8 / EC9 / EC10
150 cr to 300cr / 13.30 / 13.55 / 13.85 / 13.85 / 14.35 / 14.65 / 15.15 / 15.45 / 16.45 / 16.45
300 cr to 500cr / 13.05 / 13.30 / 13.60 / 13.85 / 14.10 / 14.40 / 14.90 / 15.20 / 16.45 / 16.45
HLC1 / HLC2 / HLC3 / HLC4 / HLC5 / HLC6 / HLC7 / HLC8 / HLC9 / HLC10
Turnover >500 Crore / 12.80 / 13.05 / 13.35 / 13.60 / 13.85 / 14.15 / 14.40 / 14.95 / 16.45 / 16.45

Tenor Premium for Term Loans above Rs.10 lac.

Tenor(including moratorium) / Premium
Above 1 year up to 7 years / 0.50%
Above 7 years / 0.75%

This circular supersedes all the earlier circulars on rates of interest.