Home Loan

Eligible Category of Finance

Individual (Borrower and Co-borrowers) – Salaried person/self employed person in business or profession/HUF/Association of Persons.

Age Limit

Maximum age limit 60 years. If age is above 60 years, then co-borrower be insisted upon.

Purpose

  • Purchase of Land.
  • Construction/Purchase of house/flats by individuals.
  • Repair, alternation and additions to houses/flats by individuals.

Maximum Limit of Assistance/Finance

Maximum up to Rs. 25.00 Lac (Tier 1 UCBs) Rs.50 lacs (Tier II UCBs)

*Housing Loan sanctioned above Rs. 25 Lac shall be out of Advances to Priority Sector
  • 75% of the cost of purchase of house (including registry charges).
  • 75% of estimated cost of construction.
  • 70% of cost of purchase of land.
  • 90% of the conversion and regularization charges paid to Govt. Authority to get registered lease deed/patta.
  • 50% of the wooden work. OR

48 times of monthly income or 4 times of yearly income. In genuine cases loan limit up to 5 times of annual income can be considered.

The maximum loan should not exceed 15% of the capital fund in case of individuals and 40% of the capital funds for group of borrower. The capital fund for the purpose shall include both Tier I and Tier II capital.

Disbursement

Disbursement of the loan will be made as per guidelines suggested as below :

Execution of loan documents & obtaining of original title documents :
Disbursement of sanctioned House Loan would be made only after execution of loan documents and obtaining of original title documents of land/property proposed to be mortgaged to the bank, as mentioned in sanction letter & PDC's and Insurance policy etc.

The sanctioned loan may be released in instalments as detailed below :

If house loan is sanctioned only for ground floor, disbursement should be made as under :

  • 1st Instalment : 25% disbursement of sanctioned loan at the time of construction reaches to plinth level.
  • 2nd Instalment : 25% of sanctioned at the time of laying of roof, after shuttering is completed and verifying that iron for laying of roof is lying at the site.
  • 3rd Instalment : Next 25% of sanctioned loan after completion of plaster.
  • 4th & Last Instalment : Last 25% of sanctioned loan at the time of completion of flooring wood work of doors etc. in progress.

If loan is sanctioned against land and construction of house for ground floor :

  • Disbursement of loan against land : It may be released in one instalment only after obtaining registered title documents of property as mentioned in the proposal/sanction letter, verification of payments, PDC's Insurance policy etc.
  • Loan against Construction of Building : It may be disbursed in four instalments as mentioned above.

If loan is sanctioned against land and also for construction of ground and first floor :

Disbursement of Loan against land : It may be released in one instalment only after obtaining registered title documents of property as mentioned in the proposal/sanction letter, verification of payments, PDC's & Insurance Policy etc.

Disbursement of Loan against Construction :

  • 1st Instalment : 15% of sanctioned loan at the time of construction reaches to plinth level.
  • 2nd Instalment : Next 20% of sanctioned at the time of laying of roof of first floor after shuttering is completed and after verifying that Iron for laying of roof is lying at site.
  • 3rd Instalment : Next 25% of sanctioned loan at the time of laying of roof of second floor and after verifying that steel is lying at site for laying of roof of second floor.
  • 4th Instalment : Next 20% of sanctioned loan after completion of plaster of both floor's construction.
  • 5th & Last Instalment : Last 20% of sanctioned loan at the time of completion of floors and wood work of doors etc. in progress.

Note

In case construction progress is already in advance stage i.e. roof has already been laid or finishing work in progress then after recording of these facts on file, 1st & 2nd Instalments of sanctioned loan may be released simultaneously at one time.

Site Inspection will be got carried out by the Branch Manager himself or second officer of the Branch. However, 1st and last site inspection should be got carried out by the Branch Manager himself. Branch Managers will strictly follow the procedure of disbursement of House Loan in instalments as above, after physical inspection of site and reporting of the progress of the construction on file.

Interest Rate

Interest rate on floating basis is charged on reducing method on monthly basis at the rate prevailing time to time as per Bank's Policy. On default on EMI panel interest may be charged at prevailing rate time to time as per Bank's Policy. The prepayment/advance payment may be accepted only after prior permission/approval of the bank for which bank shall have right to make good of the financial loss by way of charging pre payment premium at the rate as may be decided from time to time by the Bank.

Security

Primary/Main Security

By mortgage of residential plot/house/flat/immovable property belonging to borrower and co-borrower.

Note: Legal opinion & non encumbrance certificate shall be obtained from bank's panel advocate on acceptance of title documents of property.

Personal Guarantee

A personal guarantee of two persons having adequate net worth shall be provided as per the sanction letter.

Repayment Period

The housing loan will be repayable with in maximum period of 15 years including moratorium period or repayment holiday.

The normal policy is that moratorium period is six months from the date of first disbursement or after two months of last disbursement which ever is earlier is allowed. Bank will decide the moratorium period depending upon the individual case, but it will not be more than 18 months from the date of construction. Repayment of the loan shall be done as follow –

  • On part disbursement, applicant to pay Pre-EMI Interest (i.e. interest on the amount disbursed) until Final Disbursement.
  • On Full disbursement, applicant has to pay EMI (Equated Monthly Installment) combining both interest and principal.

Fees

The Processing and Administrative Fees shall be applicable as per the Bank's norms specified time to time (as applicable), which will be: 1% of the Loan amount subject to minimum of Rs. 500/-.

Other general terms and conditions of the Bank including Insurance Coverage of Property shall also be made applicable

Sanction & Disbursement of House Loan

Housing Loan for Building Construction

A copy of approved/sanctioned plan issued by the competent authority in the name of a person applying for such loan must be obtained along with the application.

An affidavit-cum-undertaking must be obtained from the person applying for such credit facility that he shall not violate the sanctioned plan, construction shall be made strictly as per the sanctioned plan & shall furnish completion certificate within 3 months of completion of construction.

An architect approved by the Bank shall certify at various stages of construction of building that the construction is strictly as per sanctioned plan and shall also certify at a particular point of time that completion of construction/building is as per site plan approved by the competent authority. In case plot size is more than 500 sq. mtrs. Then a certificate of completion of construction issued by the competent authority/local authority shall have to be obtained by the applicant and which shall be further certified by the approved chartered architect/engineer of the Bank.

Housing Loan for Purchase of Constructed Property / Built up Property

An Affidavit/undertaking shall be furnished by the applicant that the build up property has been constructed as per the sanctioned plan and/or building bye-laws along with completion certificate.

An Architect/approved chartered valuer shall certify before disbursement of the loan that the build up property is strictly as per sanctioned plan and/or building bye laws.

No loan would be granted in respect of those properties which fall in the category of unauthorized colonies unless and until the same has been regularized and developed by the competent authority.

No loan would be granted in respect of properties meant for residential use but which the applicant intends to use for commercial purposes and declaring so while applying for the loan.

Working capital / Term Loan requirements of the eligible units are being assessed strictly as per the RBI guidelines effective on the Bank.

Home Loan form

Auto Loan

Object

To provide financial assistance for purchase of car/jeep, motorcycle etc.

Eligibility

  • Individual/firm - for personal use.
  • Individual/firm - for professionals.
  • Individual/firm - for taxi purposes.

Age Limit

Individual having age between 21 years to 60 years. If age is above 60 years, then co-borrower is insisted upon.

Purposes

Vehicle Loan will be granted for purchase of vehicle including car/ jeep/motorcycle for personal use, business use and also for taxi purposes.

Financial Assistance

70% of the cost of vehicle including registration charges or 30 times of monthly income whichever is maximum.

Margin

25-30% margin be kept on the cost of vehicle including registration charges.

Disbursement

After execution of loan documents and obtaining request from the borrower, sanctioned loan amount plus margin money, if any, will be disbursed directly to the dealer/seller. A cheque/DD of the disbursable amount will be issued in the dealer's name with forwarding letter stating that the hypothecation of the vehicle in favour of the bank should be endorsed on the registration of the vehicle to be issued from R.T.O. Similarly, an endorsement of hypothecation will be made on the Insurance Policy. While releasing the sanctioned loan, Branch Manager will ascertain that the borrower has paid some contribution to the dealer/seller as advance money and receipt of the same is furnished or his contribution will be got deposited with the bank and a DD/cheque of the total payment of sanctioned loan so as to ensure that full amount of the vehicle is paid to the dealer/seller. However, Branch Manager will release DD/Bankers Cheque of the loan amount to the dealer after obtaining the prescribed loan documents.

After receiving the vehicle from the dealer borrower will deposit the original bills in the Bank. Branch Manager will thereafter verify the particulars of the vehicle from the bills and will get the signature of the borrower/s on the bills in token of having received the vehicle for which he/ they availed the loan. Branch Manager will also undertake the following acts:-

  • Photocopy of the invoice to be verified by the Branch Manager with original & seal of the bank to be affixed on original specifying hypothecation in favour of the bank.
  • Receipts of the payments made by the party and the bank to the dealer.
  • Photocopy of the Registration Certificate of the vehicle issued by the RTO, verifying an endorsement in favour of the Bank.
  • Photocopy of the Insurance Policy/Cover Note after verifying an endorsement in favour of the Bank.
  • The chasis no./engine no., mentioned on the Registration Certificate be verified from the vehicle at the time of carrying-out the physical inspection of the vehicle.

Interest Rate

As applicable from time to time.

Repayment of Loan

In 3-5 years (30-60months), depending upon the quantum of loan and repaying capacity of the applicant. PDCs must be obtained for monthly instalments.

Security

Hypothecation of the vehicles i.e. car/jeep/motorcycle etc. which is being financed by the bank.
An accidental/LIC Policy of the borrower can also be insisted upon.

Additional Security

If loan to be considered for the vehicle to be used for taxi purposes then an additional security of immovable property may be insisted upon.

Guarantee

The third party personal guarantee of two persons having adequate net worth will be insisted upon.

Processing Fee

As per norms may be charged. (1% of the loan amount)

Advance for Purchase/Construction of Commercial Building/Shop Appraisal

Purpose/Object

The main object of the scheme to provide financial assistance to meet the various needs/requirement of the individuals/selfemployed persons or Professionals/Business persons for purchase/ construction of commercial building/shop loan.

Eligibility

Individuals (it may include co-borrower) who are -
  • Self employed persons
  • Professionals
  • Businessman

Other - HUF, Trust, Firm including partnership firm, Group, Association of persons & Pvt./Ltd. Company.

Age Limit

Maximum age limit 60 years. If age is above 60 years than co-borrower be insisted upon.

Loan Amount

Admissibility of loan be assessed based on the following -
  • 48 times of monthly income or 4 times of yearly income. OR
  • 75% of registered value *(including registry expenses). OR
  • On the basis of project report. OR
  • Maximum amount/up to Rs. 50 lacs.

Relaxation

  • In genuine cases loan limit up to 5 times of annual income may be considered.
  • Relaxation in margin up to 5% be considered (i.e. up 80% of registered value including registry charges).

Security

Equitable mortgage of legally acceptable title documents of no encumbered shop/commercial building/Urban property which is either self occupied or vacant, which is not mortgaged to any institution/bank for any purpose. In case of shop being purchased from builder in a commercial building/trade centre, the following documents would be required :

  • Original stamped agreement executed with the builder on Rs. 100/- stamp paper.
  • Receipts of the payment made to the builder.
  • Certified copy of permission letter granted by the competent authority to the builder.
  • Certified copy of approved plan of building/commercial complex.
  • Any other document, if required.

Disbursement of Loan

Term Loan

After execution of loan documents & furnishing of title documents of the property, the sanctioned loan amount of loan can be disbursed in one or two instalments as per applicant's/borrowers need.

Interest Rate

As per interest rates prevailing from time to time, In case O.D. limit, interest would be charged on monthly basis as charged/ calculated on CC/Hyp. accounts.

Personal Guarantee

Besides primary security as detailed above : Third party personal guarantee of two persons having good credentials and adequate net worth shall required to be furnished for the security of the loan.

Repayment Period

Term Loan

Maximum of 10 years (120 months) to be recovered in monthly installments through PDCs.

Processing Fees

As per rates/charges prevailing from time to time. Normally it is 1% of loan amount.

Working capital / Term Loan requirements of the eligible units are being assessed strictly as per the RBI guidelines effective on the Bank.

Auto Loan form

Education Loan

Purpose/Object

The scheme aims at providing financial assistance to deserving/ meritorious students pursuing higher education (full time studies) in India. Viz., Post Graduation courses-Master & Ph.D.; Professional Courses, Engineering, Medical, Agriculture, Veterinary, Law, Dental, Management, Computer etc., Computer Certificate Courses of reputed Institutes accredited to Department of Electronics or institutes affiliated to University; Courses like ICWA, C.A., CFA etc., courses conducted by IIM, IIT, IISc, XLRI, NIFT etc., Regular Diploma/Degree courses like Aeronautical, Pilot Training, Shipping etc. approved by DGCA etc., Courses offered by National Institutes and other reputed Private Institutes.

An Education Loan Scheme is for the students who need funds for :
  • Fee payable to Colleges/Schools/Hostel.
  • Examination/Library/Laboratory fees.
  • Purchase of Books, Equipment, Instruments.
  • Purchase of Computers/Laptop needed to complete the course.
  • Any other expenses to complete the course like study tours, project work, thesis etc.

Eligibility

Applicant should be an Indian National and secured admission to professional/technical courses in India through entrance test/merit based selection process.

OR

Indian nationals not above 45 years of age those who secured admission in a recognized courses of an approved university (AICTE approved institutions) OR institutes recognized by statutory body.

Age Limit

Maximum age limit 45 years.

Loan Amount

  • Education in India – Maximum Amount Rs. 10.00 lac
  • Education Abroad – Maximum Amount Rs. 20.00 lac

Margin

25% margin shall be kept on admissible expenses considered for loan.

Note

  • Maximum Admissible Loan/Limit shall be 50% of MRV of property with power of relaxation to 60% of MRV by the LSC.
  • Minimum amount Rs. 1.00 lac and maximum amount Rs. 10.00 lac.

Valuation of Property

The market value of the property shall be got assessed form the approved/chartered valuer of the Bank.

Security

Equitable mortgage of legally acceptable title documents of unencumbered residential house/flat/Urban property/Commercial/ Industrial Property in the name of father/parents/guardian of applicant who will be co-borrower which is either self occupied or vacant or let out and not mortgaged to any institution/bank for any purpose.

The Education Loan may also be granted against the security of third person property means other than borrower/co-borrower's property. In such case the third person shall be mortgagor guarantor.

Note:

The loan may be considered/granted as a special case in respect of properties already mortgaged to our bank against some other credit facilities granted to the applicant subject to the conditions that overall security margin to 50% is available/ maintained for the proposed loan.

Legal opinion & non encumbrance certificate shall be obtained from bank's panel advocate on acceptance of title documents of property.

Disbursement of Loan

Disbursement of sanctioned Education Loan would be made only after execution of loan documents and obtaining of original title documents of land/property proposed to be mortgaged to the bank, as mentioned in sanction letter & PDCs and Insurance policy etc. The loan amount shall be disbursed to the borrower on producing requisition letter for fee payable to College/School/ Hostel/Examination/Library/Laboratory fee, Purchase of Books/ Equipments/Instruments/Purchase of Computer-essential for completion of the course. And any other expenses required completing the course-like study tours, project report, thesis etc.

Interest Rate

Generally interest rate on floating basis is charged on reducing method on monthly basis at the rate prevailing time to time. On default of EMI penalties/follow-up/recovery charges as per norms of bank shall be charged at prevailing rate from time to time as per bank's policy. The prepayment/advance payment charges are exempted on prepayment/advance payment of education loan.

Personal Guarantee

Besides primary security as detailed above Third party personal guarantee of two persons having good credentials and adequate net worth shall required to be furnished for the security of the loan.

Repayment Period

The Education Loan will be repayable with in maximum period of 8 years including moratorium period or repayment holiday. Moratorium period will be twelve months from the date of first disbursement or after two months of last disbursement which ever is earlier. Bank will decide the moratorium period depending upon the individual case. Repayment of the loan shall be done as follow -

  • On Part Disbursement, co-borrower to pay Pre-EMI Interest
    (i.e. interest on the amount disbursed) until Final Disbursement.
  • In case of pre termination/non complication of course, the borrower shall have to deposit/cleared/adjust entire loan amount alongwith interest immediately.
  • On Full Disbursement, Applicants has to pay EMI (Equated Monthly Installment) combining both interest and principal, after 6 months of completion of course, till such time to father/parents of the borrower/co-borrower shall continue to pay interest.

Processing Fees

The Processing and Administrative Fees shall be applicable as per the Bank's norms specified time to time (as applicable). Say 1% of the Loan amount, Maximum to Rs. 10,000/-

Insurance

The Bank can tie up with a Life Insurance Company to provide protector plan cover for loan amount and Life Insurance cover for student borrowers.

Other general terms and conditions of the Bank including insurance coverage of property shall also be made applicable

Working capital / Term Loan requirements of the eligible units are being assessed strictly as per the RBI guidelines effective on the Bank.

Sme Loan

Definition of Micro, Small and Medium Enterprises

Enterprises engaged in the manufacture or production, processing or preservation of goods as specified below:

  • A micro enterprise is an enterprise where investment in plant and machinery does not exceed Rs. 25 lakh;
  • A small enterprise is an enterprise where the investment in plant and machinery is more than Rs. 25 lakh but does not exceed Rs. 5 crore; and iii) A medium enterprise is an enterprise where the investment in plant and machinery is more than Rs.5 crore but does not exceed Rs.10 crore.

Enterprises engaged in providing or rendering of services and whose investment in equipment (original cost excluding land and building and furniture, fittings and other items not directly related to the service rendered or as may be notified under the MSMED Act, 2006). These will include small road and water transport operators (owning a fleet of vehicles not exceeding ten vehicles), retail trade (with credit limits not exceeding Rs.10 lakh), small business (whose original cost price of the equipment used for the purpose of business does not exceed Rs.20 lakh) and professional and self employed persons (whose borrowing limits do not exceed Rs.10.00 lakh of which not more than Rs. 2.00 lakh should be for working capital requirements except in case of professionally qualified medical practitioners setting up of practice in semi-urban and rural areas, the borrowing limits should not exceed Rs.15 lakh with a sub-ceiling of Rs.3 lakh for working capital requirements).

  • A micro enterprise is an enterprise where the investment in equipment does not exceed Rs. 10 lakh
  • A small enterprise is an enterprise where the investment in equipment is more than Rs.10 lakh but does not exceed Rs. 2 crore
  • A medium enterprise is an enterprise where the investment in equipment is more than Rs. 2 crore but does not exceed Rs. 5 crore.

Bank's lending to medium enterprises will not be included for the purpose of reckoning under the priority sector.

Working capital / Term Loan requirements of the eligible units are being assessed strictly as per the RBI guidelines effective on the Bank.

Traders Loan

Traders are sanctioned working capital loans in the form of Cash Credit, Overdraft, Term Loans & also Short Term Loans depending upon the requirement of their business / trade which is legally permissible.

The assessment of working capital requirement borrowers other than SSI units, fund based working capital limits upto Rs. 100 lac and SSI units required funds based working capital limit upto Rs. 500 lac, is being made on the basis of their turnover/projected annual turn-over. In according to the existing guidelines, the total working requirement will be assessed at 25% of the turnover. Out of this, borrower has to contribute 5% of the turnover and bank may provide finance to the extent of 20% of the turnover/projected turnover. In short, the bank may provide working capital finance to the extent of 20% of the turnover/projected turnover. Requirement of working capital finance above Rs. 100 lacs and in case of SSI unit above Rs. 500 lacs may be provided based on prudential norms for lending as prescribed by the RBI regarding maximum permissible bank finance (MPBF), maintaining minimum current ration of 1.33:1.

Working capital / Term Loan requirements of the eligible units are being assessed strictly as per the RBI guidelines effective on the Bank.

Mortgage Loan

Purpose/Object

It is a general purpose loan scheme to meet the requirement of the individuals/self-employed persons or professionals and businessman/ others who are income tax payee. Sometimes funds are needed to meet the various need/requirements to individuals, self employed persons and businessman/others who are income tax payee and raising of various type of the small loans from the institutions / banks may not be practically possible/feasible. The salient features of the scheme are detailed below.

Eligibility

Individuals, (it may include co-borrower) who are -
  • Salaried Person
  • Professionals
  • Businessman/Others who are income tax payee.

Others - HUF, Trust, firm including partnership firm, group, association of persons, Pvt./Ltd. company.

Net monthly income for salaried persons is not less than Rs. 5000/- p.m. or net annual income is not less than Rs. 60,000/- in case of self employed and others.

Age Limit

Maximum age limit 60 years. If age is above 60 years then co-borrower be insisted upon.

Loan Amount

Term Loan
  • Individual, HUF, Trust & Professionals : 4 to 5 times of income as per Income Tax Return.
  • Commercial/Industrial entity (Proprietorship/ Partnership, Company Pvt./Ltd., and Association of persons : 4 to 5 times of Cash Profit.
Overdraft Limits

4 to 5 times of Cash Profits or 20/25% of annual actual or estimated sale whichever is higher.

Note
  • Maximum Admissible Loan/Limit shall be 50% of MRV of property with power of relaxation to 60% of MRV by the LSC.
  • Minimum amount Rs. 1.00 lac and maximum amount Rs. 50.00 lac.

Margin

50% of market value of property.. The market value of the property shall be got assessed form the approved valuer of the Bank.

Note: Relaxation in margin up to 10% be considered by the Loan sub-committee.
(i.e. 40% of marked value of property).

Security

Equitable mortgage of legally acceptable title documents of non-encumbered residential house/flat/Urban property/Commercial/ Industrial Property in the name of borrower co-borrower which is either self occupied or vacant or let out which is not mortgaged to any institution/bank for any purpose. The mortgage Loan or O.D. facility may also be granted against the security of third person property means other than borrower /co-borrower's property. In such case the third person shall be mortgagor guarantor.

Note: The loan my be considered/granted as a special case in respect of properties already mortgaged to our bank against some other credit facilities granted to the applicant subject to the conditions that overall security margin to 50% is available/maintained for the proposed loan/limit against this scheme.

Disbursement of Loan

Term Loan : In one & two instalments as per applicant's/ borrowers need.

O.D. Limit

Borrower would withdraw the required amount up to sanctioned loan/limit which would be gradually reduced every six months i.e. as on 30th September and 31st March. First reduction would be last day of next half year. For example; if disbursement is made in June than first reduction would be on 31st March and then further reduction would be at every half year interval.

OR

The borrower can withdraw the loan amount up to sanctioned loan/limit which may not be reduced during the currency of loan/limit repayable at the end of the repayment period. In such case the O.D. limit has to be renewed by the Bank every year.

Interest Rate

As per interest rates prevailing from time to time, In case of O.D. limit interest would be charged on monthly basis as charged/ calculated on CC/Hyp accounts.

Personal Guarantee

Besides primary security as detailed above Third party personal guarantee of two persons having good credentials and adequate net worth shall required to be furnished for the security of the loan.

Repayment Period

Term Loan : Maximum of 10 years (120 months) to be recovered in monthly instalments through PDC.
O.D. Limit : It would be reduced on half yearly basis so that O.D. Limit under mortgage loan scheme is finally paid with last day of repayment. In case O.D. Limit is not to be reduced half yearly than it requires renewal every year.

Processing Fees

Term Loan & O.D. Limit repayable in monthly/half yearly instalment as per rates/charges prevailing from time to time, say it is 0.8% of the loan amount.

In case of O.D. Limit, without monthly/half yearly reduction/repayment & renewal yearly would require to pay processing fee every year say @ 0.25% as applicable in case of CC/ Hyp. limit besides processing fee applicable/payable under mortgage loan scheme i.e. say 0.8% of the sanctioned loan/limit.

Other general terms and conditions of the Bank including insurance coverage of property shall also be made applicable.

Working capital / Term Loan requirements of the eligible units are being assessed strictly as per the RBI guidelines effective on the Bank.

Mortgage Loan form

Gold Loan

In order to mitigate the inherent risks attached to sanction of loans and advances against Gold / Silver ornaments, Bank will observe the safeguards as detailed below :

Ownership of Ornaments

It is advisable that the advances are made to persons properly introduced to the Bank. The Bank must satisfy itself about the ownership of the gold ornaments etc. before accepting them for pledge. The Bank will obtain a declaration from the borrower that the ornaments are his own property and that he has the fullest right to pledge them to the bank. Taking of ornaments for pledge and release thereof to the parties concerned after repayment of the bank's dues will be done strictly in the authorised official's room to avoid any risk.

Appraiser

Bank will appoint an approved jeweller or shroff as an appraiser for valuation of the gold ornaments proposed to be pledged to the bank and obtain adequate security from him in the form of cash and indemnity bond. Valuation and appraisal of the ornaments in the bank's premises itself would be ideal but when these are not possible, the bank must take suitable precautions against their loss while in transit. Bank will send the ornaments to the appraiser in a locked box, one key of which would be kept with the appraiser and the other with the bank. The box would be sent through a responsible member of the staff along with the prospective borrower. The placing of ornaments in the box at both the ends will be done in the presence of the employee carrying the ornaments to the appraiser and the borrower. The bank will take a suitable insurance cover for loss of the ornaments while in transit.

Valuation Report

The valuation certificate of the appraiser would clearly indicate the description of the ornaments, their fitness, gross weight of the ornaments, net weight of the gold content exclusive of stones, lac, alloy, strings, fastenings and the value of the gold at the prevailing market price. The valuation report will be duly signed by the appraiser and kept along with the loan documents by the bank.

Record of Security

The full name of the borrower alongwith his father / husband' name, his residential address, date of advance, amount and description of the ornaments in detail will be recorded in the gold ornaments register which would be checked / initialed by the Manager.

Custody of Ornaments

The ornaments belonging to each borrower(or articles of each loan) together with a list indicating the description of ornaments, gold loan account number, name of party, etc. will be kept separately in small cloth bags. A tag indicating loan account number and name of the party will be tied to the bag to facilitate identification. The bags will be arranged in trays according to loan account numbers and kept in the strong room or fire proof safes under joint custody.

Period

The period of advance against gold ornaments will be generally restricted to six months or one year.

Margin

Adequate margin on the market value would be maintained. Bank will collect interest on advances promptly. In no circumstances would it allow to water down the margin by debiting the interest accrued to the loan account.

Return of Ornaments

On repayment of the loan together with the interest payable in the account, the ornaments will be returned to the borrower and his receipt obtained in token of having received the ornaments.

Part Release

While allowing part release of the ornaments against part repayment of the loan, care will be taken to ensure that the value of the left-over ornaments is sufficient to cover outstanding balance with the margin prescribed in the account.

Delivery to third Parties

When the ornaments are delivered to third parties, a letter of authority from the borrower and subsequent confirmation of the borrower will be obtained. The letter of authority will contain an undertaking by the borrower, absolving the bank of any responsibility in the event of dispute or loss arising from the delivery of the ornaments to the party named therein. The receipt of the third party will be obtained on the letter of authority as well as in the gold loan ledger.

Default

When the borrower fails to repay the loan on the due date, a notice calling upon him to repay the loan within a specified time will be given and if no response is received, a reminder will be sent by registered post informing the borrower that the ornaments would be auctioned and after adjusting the sale proceeds against the outstanding dues to the bank, the balance, if any, would be paid to the borrower against his receipt.

Re-pledge of Ornaments

Bank will not make advances against repledge of ornaments as this facility is likely to be misused for financing moneylenders, which is not a desirable activity.

Insurance

The jewels pledged to the bank will be insured for the appraised value against the risk of burglary. If bank stores the pledged jewels in fire-proof strong rooms, insuring them against fire may not be necessary. Bank will take blanket insurance policy covering cash, jewels and other valuables and also covering all types of risks.

Verification

Surprise verification of the packets containing gold / silver ornaments by an officer other than the joint custodian will be undertaken and recorded in a separate register with necessary details.

Bullet Repayment

Bank with the approval of their Board may permit bullet repayment of gold loans up to Rs 1.00 lakh as an additional option subject to the following guidelines :

  • The amount of gold loan sanctioned will not exceed Rs 1.00 lakh at any point of time.
  • The period of the loan shall not exceed 12 months from the date of sanction.
  • Interest will be charged to the account at monthly rests but will become due for payment along with principal only at the end of 12 months from the date of sanction.
  • The bank will prescribe a minimum margin to be maintained in case of such loans and accordingly, fix the loan limit taking into account the market value of the security (gold / gold ornaments), expected price fluctuations, interest that will accrue during the tenure of the loan etc.
  • Such loans shall be governed by the extant income recognition, asset classification and provisioning norms which shall be applicable once the principal and interest become overdue.
  • The account would also be classified as NPA (sub standard category) even before the due date of repayment, if the prescribed margin is not maintained.
  • Working capital / Term Loan requirements of the eligible units are being assessed strictly as per the RBI guidelines effective on the Bank

Corporate Salary Package

  • This scheme is designed for employees of Corporate/business establishments and institutions.
  • Minimum requirement-10 Permanent employees in the organization.
  • Minimum Salary Pay our-Rs.50000/-per month.
  • Minimum monthly Gross-Rs.5000/-
  • Salary per employee.

Different Variants of the Scheme

  • Easy Overdraft-up to two months net salary if salary is routed through is Rate of Interest will be charged as per rates of personal loan at present.
  • Instant credit of outstation cheque up to Rs.50000/-.
  • Allotment of lockers on priority basis.
  • Priority in service.
  • Concession in processing charges on fresh personal segment advances.