LOAN AGAINST FUTURE FEES RECEIVABLES
Purpose
- For meeting on going business needs including expansion of present business, establishment of new school/college/institute, day to day, expenses, payment of existing Loan dues etc.
Nature of facility
- Term Loan/Overdraft facility with reducing Drawing Power.
Target customer
- Schools, Colleges, Educational Institutes, Training Centers approved by Govt/UCT/AICTE/MCI and other approved regulatory authorities.
Eligibility
- Schools, Colleges, Educational Institutes, Training Centers approved by Govt/UCT/AICTE/MCI and other approved regulatory authorities.
- The school/ college/institutes should be operational for more than 3 consecutive academic years
Quantum of Loan
- Minimum Loan Amount is Rs. 25 lacs
- Maximum Loan Amount is Rs.100 Cr.
- Up to 2 year duration: 85% of Net Present value of Future Fees Receivables
- For 2 to 5 year duration: 80% of Net Present value of Future Fees Receivables
- For 5 to 10 year duration: 75% of of Net Present value of Future Fees Receivables
Future Fees Receivables = Gross Fees Receivables less (advance fees received + maintenance and operational expenses + any interest/ installments + other statutory dues of the lessor)
Rate of interest
- For repayment period up to 3 years: MCLR + 2.00%
- For repayment period above 3 years: MCLR + 2.50%
Security
- Assignment of Future Fees receivables in favor of the Bank.
- Equitable Mortgage of unencumbered property preferably belonging to the borrower for which the loan has been taken, value of which should be to the minimum of 125% of proposed loan.
- If the land and building of borrower is already mortgaged with other bank, security by way of second charge in favour of Bank should be created as collateral on the said mortgaged property.
Repayment
- To the extent of period of discounting but Maximum 10 years.
- Repayment shall be Equated Monthly Installments.
Processing Charges
- 0.5% of the loan amount subject to minimum of Rs.10,000/- and maximum of Rs.25 lakhs.
Guarantee
- Guarantee of owner of security offered for mortgage if the security is not in the name of applicant.
Insurance
- The mortgaged property should be insured against fire, riots wherever required and also against other appropriate hazards, such as earthquake, flood, lightning etc. with the usual Bank clause for full value of the property. Insurance cover should be kept in force during the currency of loan.