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Indian Overseas Bank Central Office 763 Anna Salai Chennai 600 002

ADVANCES - PERMANENT Ref.No: ADV/ 271 /2012-13 Date: 23.11.2012 Issuing Dept.: SME

CIRCULAR TO ALL REGIONS / BRANCHES IN INDIA NEW CREDIT SCHEME FOR WOMEN ENTREPRENEURS IOB SME MAHILA PLUS ( Women Enterprising Entrepreneurs Promotion Scheme) PREAMBLE: In the present era women play a dominant role in every sphere of life and in industrial development too. We find a lot of women entrepreneurs who have come up by sheer hardwork, well encouraged by their parents/spouse and other kith and kin. We have been receiving suggestions to introduce a scheme for women entrepreneurs/selfemployed women who are already in business or who desire to start a business/unit of their own. In order to encourage more and more women entrepreneurs ,we have evolved a scheme called IOB SME MAHILA PLUS exclusively for women entrepreneurs as well as women professionals to start their own venture or a service enterprise. The scheme we have formulated can be brought under MSE category under manufacturing or service sector. The scheme will be marketed along with other similar Schemes in the retail segment. Salient features of the Scheme are listed in the Annexure. CONCLUSION: In order to encourage more and more qualified women to become selfemployed and build up entrepreneurship traits among them, this scheme is specially proposed for enterprising women entrepreneurs. Wide publicity can be given for the scheme to bring in many women aspirants for promoting business ventures. Banners shall be displayed at the branch premises to popularise the scheme and other marketing avenues shall also be explored. We advise Branches/ROs to vigorously market the scheme under IOB SME MAHILA PLUS scheme and thereby enhance the credit disbursement to women entrepreneurs in MSE sector. (K.Subrahmanyam) GENERAL MANAGER Encl: Annexure

Annexure to IOB SME MAHILA PLUS OPERATIONAL INSTRUCTIONS: Purpose of the Loan To set up a factory/business premises either manufacturing or service enterprise qualifying under Micro or Small enterprises. To upgrade the existing unit and purchase of equipments, Machineries , Computers etc. Fresh or additional working capital limits Qualified women(minimum graduate ) who desire to start a unit in the age group of 21 to 50.Women with technical qualification will be given preference. Women professionals in any field can also avail credit under the scheme. Either a Proprietorship Concern or a partnership with women in the lead Private Limited companies with woman as the Managing director/or a Director in a key position Existing units fully managed by a woman entrepreneur are also eligible under the scheme KYC compliance Should not be in RBI Defaulters List. CIBIL report should be satisfactory. Mode of Assistance Quantum of Finance By way of Term Loan for fixed Assets. Cash Credit for Working Capital Composite loan upto Rs 2 crores for a Manufacturing enterprise Composite loan upto Rs 1 crore for a Service enterprise Rate of Interest Base Rate +1.25 % for working capital (Current Base Rate is 10.50 % and applicable rate is 11.75 %) Base Rate + 1.50 % for Term Loams for construction of factory / business premises (applicable rate is 12.00%) Base Rate + 1.75 % for purchase of Machineries / Equipments Margin As per extant guidelines for lending to MSE sector. 2


Other Conditions


PRIME: 1.Term loan :Assets acquired out of the loan . 2. Working Capital: Stocks and assignment of Book Debts/Receivable up to 120 days. COLLATERAL : 1. No collateral security or third party guarantee upto Rs.100 Lacs. 2. All loans upto Rs.100 Lacs to be covered under CGTMSE Guarantee scheme. 3. Collateral security may be taken for loans above Rs.100 Lacs Collateral security to cover at least 50 % of the credit facility if the loan granted is above Rs 100 lacs

Third Party Guarantee Other Features

Optional above Rs 100 lacs Audited financials applicable for credit limits above Rs 25 lacs Simple processing with a turnaround time of 14 days from the date of submission of the proposal. to be serviced on monthly

Repayment Cash credit : To be renewed annually and Interest basis

Term Loan : 10 years for term loan for construction of factory/business premises 7 years in Equal Monthly Instalments in case of Machineries Moratorium period of 12 months for establishing a new manufacturing unit and in all other cases moratorium of 3 months is applicable. Interest to be serviced as and when debited including holiday period. Repayment to commence from the month of commencement of commercial operation. Processing Charges Rs 200 per lac both for working capital and TL with a maximum of Rs 20000.