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MSME

Last Updated on: 27/03/2025

MSME-INSTA-FUND

Eligibility

  • Existing MSME borrowers with Udyam Reg. No
  • Standard accounts enjoying facility under sole/multiple banking excluding SMA1 & SMA2 in the last 6 months.
  • Individual/ Proprietary/ Partnership firm/ Societies/ Trust/ LLP/ Pvt Ltd/ Public Limited company

Purpose

  • To meet out WC requirements of urgent bulk/ additional ordersover and above the regular orders of Micro, Small, Medium Enterprises(as per revised MSME classification)

Loan Amount

  • Need based WC limit of maximum Rs. 25.00 Cr.

Margin

  • Minimum Margin requirement - 20%
  • 10% margin for orders from Central/ State Govt./ PSU/AAA/AA/A rated companies.

Rate of Interest

  • The rate of interest shall be based on internal rating of the account.

Security

  • Current assets created out of the loan should be hypothecated/charged to the Bank.
  • Existing collateral should be charged as security for the Instafund too.
  • In case of Multiple banking/ consortium paripassu charge to be created.

Repayment Period

  • 150 days or validity of limit, rollover for maximum of 30 days.

Processing Fee

  • 0.50% of MSME Instafund limit

Other Conditions

  • Limit cannot coexist with Adhoc/Excess facility.
  • Instafund limit should not be subsumed in the subsequent enhancement. Enhancement/Fresh credit facility shall be effective only after 15 days.
  • Borrowers with satisfactory relationship of 5 years can avail limit up to 1 Cr based on simple declaration.
  • Borrowers with satisfactory relationship of 3 years can avail limit up to Rs. 25 Lakhs based on simple declaration.
  • If the MSME INSTAFUND is not regularised within the due date penal charges of 2.00% plus applicable GST will be charged.