Cash Credit / Overdraft agst Stock/Book Debts
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- Cash Credit / Overdraft agst Stock/Book Debts
Cash Credit Overdraft agst. Stock
- Cash Credit Overdraft agst. Stock/Book-debts facility allowed to borrowers for their day to expenses and working capital requirements.
- Borrower has to submit bank’s standard loan / limit application in the prescribed form along with projections, audited Balance sheet and profit & loss accounts for the last three years (wherever applicable) along with annexure, personal Balance sheet, Net worth of the Borrower , with proof of properties and income tax returns with statement of income for the last three years of all partners / proprietor / Directors / Guarantors, all associate / family concerns , month wise figures of sales & purchase for the last year and current year, orders on hand etc.
- Justification for limit applied for will be based on projected sales.
- Share application money should be obtained for shares in the name of the firm, borrower, proprietor / partners and guarantors along with Loan application form, wherever applicable.
- Details of all properties of Proprietor / Partners / Directors / Associate concerns are required.
- Borrower has to submit stock statement every month or at the interval as may be decided by the Board of Directors and in format prescribed by the Bank. Customer enjoying Stock/Book-debt limit shall submit Stock/Book-debt Statement upto 20th of the next month. Penal interest of 1% for late submission of Stock/Book-debt Statement (after 20th day of the month).
- Bank official will periodically verify such statements vis-a-vis physical stocks.
- Margin may be decided by Board of Directors, depending upon the qualities of the goods , but should not be less than 10 %.
Agst. Book-debts
- This facility is to be allowed against hypothecation of book debts of reputed parties arising out of genuine trade transactions only.
- No advance should be allowed against book debts of sister/associate/family concerns without specific sanction of central office or book debts older than 90 days.
- Borrower has to submit book debt statement with position at the end of each month within 20 days from the end of each month or at lesser intervals as may be decided by Board of directors, in a specific case.
- Bank official will verify Book debts as shown in the statement submitted to the bank Borrower ‘s bill book/ sales journal, tax records etc.
- CA Certified book debt statement should be submit to bank once a year, i.e. for September, in all accounts enjoying book debt & stock &/or book debt limits above Rs. 10 lacs.
- Minimum 70 % Collateral security as per bank policy is required in stock/Book-debts Limit, either in form of Immovable asset of Movable asset.
- Realisable value is consider as security value.
