Circular No.

SME/MASTER/CIR-34/2009-10 7th September, 2009

All the Branches/LHOs

Dear Sir/Madam,

MASTER CIRCULAR
SME BUSINESS UNIT
LOAN PRODUCT : SME SMART SCORE

We have been issuing Circulars/ Instructions containing operating instructions on the product
SME Smart Score from time to time. To enable the operating functionaries to have current
instructions at one place, a Master Circular incorporating all the existing Circulars/
Instructions has been prepared and is appended. We advise that this Master Circular
consolidates all the previous instructions issued up to 31/03/2009 vide the circulars listed in
the Annexure-V

Yours faithfully,

Sd/-

Chief General Manager (SME)

MASTER CIRCULAR
SME SMART SCORE

STATE BANK OF INDIA

SME BUSINESS UNIT
CORPORATE CENTRE
MUMBAI

INDEX
 SME SMART SCORE
Introduction

Loan approval to SMEs based on credit scores is widely prevalent in developed countries.
The product “SME Smart Score” has been developed for approving loans from Rs. 5.00 lacs
to Rs. 50.00 lacs under SME segment. The product is well designed and is able to generate
confidence amongst the operating staff and encourage them to sanction fresh advances
more confidently since it provides a well defined frame for evaluating the proposals.

This product is designed to avoid delays in credit delivery due to cumbersome assessment
processes. A simple Scoring Model (Annexure-III) has been designed for which all the data
required has to be furnished at one go by way of an Application Form (Annexure-I) which
has also been specially designed for this product.

The product takes into account all the critical inputs from Circles and Learning Centres.

Silent Features of the Loan Product “SME Smart Score”

�This product can be given to units in C&I, SSI and SBF segments for credit
requirements between Rs.5 lacs to Rs.50 lacs (Rs.25 lacs for T&S) based on the
projected turnover and / or project cost.

�Assessment of Loan: The loan quantum should be a minimum of 20% of turnover

and/or, 67% of project cost subject to minimum of Rs. 5 Lac. (Annexure-II)

�Working Capital loans can be sanctioned for two years subject to annual review,
specifying the limit requirement for each year. Documents are to be obtained for higher
of the two limits. The limits assessed and sanctioned for the second year should be
released after a satisfactory review of achievement of the projected level of operations
for the first year.

�Loan renewal: Working Capital loans can be renewed if credit score is 35 and above
out of 60 under business score. (Annexure-IV)

�The product is based on a set of most desirable characteristics and a set of least
tolerable characteristics of a borrower. These sets have been drawn on the basis of
extensive discussions with operational functionaries in circles and faculty at staff
colleges. The characteristics are grouped as Personal, Business (Existing &
Greenfield), Collateral and Renewal (WC). The Scoring Model for each of these is
mentioned in the Annexure I attached.

Process at the level of the appraiser:

i) Fill out the score sheet and calculate the score for personal, business and
collateral parameters.

ii) Find out the eligibility of the applicant based on total cut-off and segment wise
cut-off (there is minimum score to be reached in personal and business segment)

iii) If eligible, verify the responses from the supporting documents for correctness

iv) Assess the limits required, repayment programme for the term loan and put up a
simple note to the sanctioning authority for sanction.

v) If ineligible, put up a note for rejection / or do further detailed appraisal and

assessment if considered necessary on peculiar considerations.
vi) For renewal follow the same path as in.

(iv) for renewal.

Target Group Individually managed proprietary/partnership firm
or closely held public/private

limited companies in the Small and medium

industrial and trading sector

under C&I and SIB segments.

Eligibility The chief promoter /chief executive should be 18

to 65 years of age

The applicant must obtain a minimum overall

score of 60% with a minimum of

50% under each sub-head like Personal details,

Business details and

collateral details (except in cases where collateral

should be asked as per

Bank’s norms, where the minimum marks will be

nil).

Purpose Working Capital needs & Acquisition of fixed

assets

Type of Cash Credit / Term Loan

facilities

Quantum of MANUFACTURING UNITS: Rs.5 lacs to up to

Rs.50 lacs
Finance
(20% of annual turnover for WC loan and 67% of
project cost for TL)

TRADE & SERVICES: Rs.5lacs to Rs.25lacs

(15% of annual turnover for WC and 67% of

project cost for TL.)

For FB and NFB single exposure limits may be

sanctioned to the units.

NFB facilities can be sanctioned on the best

judgement basis within the

discretionary powers delegated to sanctioning

authority.

Margin 25% for working capital component and 33% for

TL component.
Rate of Interest Size of Credit Repayable Repayable in
Limit on 3 years and
(with effect
demand or above (%
from 29.06.09) up to 3 p.a.)

years (%p.a.)

Above Rs. 5 @SBAR 0.75 %

Lacs but above SBAR

below Rs. 25
Lacs

Rs. 25 Lacs 0.50 % 1.25 %

and above above SBAR above SBAR

but up to Rs.
50 Lacs

Security: Hypothecation of stocks and assets financed by

Bank
- Primary
As per Bank's extant norms for WC and TLs
- Collateral

Processing fees As applicable to SSI /SBF / C&I units as per

CPPD circulars

Repayment WC loan to be renewed every two years with

annual review of performance.

TL not more than 5 years excluding moratorium

not exceeding 6 months

Documentation As per simplified SME documentation

Special features A simplified appraisal model (enclosed) has been

developed to standardise

the appraisal process. A special application form

has been designed to

capture all the required information at one

instance.

**Override: Units that are not able to score 60% or more marks in the scoring model
will not
qualify for consideration under SME Smart Score Scheme. However, such loans not
approved under SME Smart Score Scheme can still be considered by the Branches
under
the normal credit dispensation based on specific considerations.
 LOAN APPLICATION FORM
ANNEXURE-I
Please fill up this form only if the answers to all the following questions are “YES”

Whether the chief promoter / Chief executive is between 18 and 65 years of age
Whether the promoters are not defaulters to the banks financial institutions.
Whether all the clearances including but not limited to environmental clearance for
the
project has been obtained / satisfactory evidence of their being made available will
be
provided?
Whether the promoters being to the area of operation of the branch and have
satisfactory
references?

General :

Name of the Company / Firm

Address (off.) (If factory and office are having different Addresses, Give the Address
Nearest to the branch First)
Plot/Building/Plat Name and Number
Street Name

City

Telephone No

Mobile

Fax:

Address(factory):
Plot/Building/Plat Name and Number

Street Name

City

Telephone no.
Mobile
Fax

Loan applied for

Purpose of the Loan

When and how the loan will be

repaid?
SME BU Master Circular as on 31.03.2009
Page 7 of 7

repaid?

PERSONAL DETAILS OF THE CHIEF PROMOTER / CHIEF EXECUTIVE

Name of the Chief / Promoter / Chief

Executive

Residential Address:
Plot/Building/Plat Name and Number

Street Name

City

Telephone No

Mobile

Fax:

What is your date of Birth?

Let us know about your family:

Are you married?

What is your spouse’s occupation?

How many children do you have?

Your house Owned Rented

What is your academic qualification? Is it

related to your line of trade?

Are you assessed the Income-Tax Yes /NO if yes PAN NO.

Do you have a life insurance policy?

Do you have a life insurance policy?

I certify that all incorporation furnished by me / us is true correct and complete. I have no

borrowing arrangement for the company / firm with any bank except so indicated in the

application form. There are no over dues / statuary dues by me or the firm / company. No

legal action has been taken against me / firm / company. I shall furnish all other information

that may be required by Bank in connection with my application. The Information may also

be exchanged by you with any agency you may deem fit you, your representative of any

other agencies as authorized by you may at any time inspect / verify my / our assets, books

of account etc. In our factory business premise as give above. You may take appropriate

safeguards / action for recovery of bank’s dues including publication of distributors name in
website/ submission to RBI. I further agree that my loan shall be governed by the rules of

State Bank of India is may be in force from time to time.

Place :

Date : Signature of Chief Promoter / Chief Executive

SME BU Master Circular as on 31.03.2009
Page 8 of 8

BUSINESS DETAILS

Year of commencement of business

State the profit / loss for the last 3 financial years

Year I Year II Year III

State the sales turnover for the last 3 financial years

YEAR I YEAR II YEAR III

Tell about your Owned Rented Leased for over 5

factory years

premises

Tell us about your product

How do you plan to produce it?

Does the product require special know how? If so, are you in possession of the know
Whether your line of activity falls under priority sector?

What are raw materials required?

How do you plan to produces them? Are they available on credit? If so what are the

terms of credit?

How do you plan to ensure the quality of your product? Any special steps being

taken?

What about the utilities like water power etc? Please describe the requirements and

how are they met?

Whether you need skilled labour? Please describe your plants for skilled labour?

Any special reason to locate your business at the present location? Is there any

advantage in procuring the raw materials locally? Is the local market big enough to

subscribe the finished product of your firm? Any other advantage?

Manufacturing process in brief :

What the level of competition for the product? How do you plan to meet the

competition?

Give the total outside liabilities for the last 3 years and your tangible network

PARAMETER Year I Year II Year III

Total outside liabilities

Tangible net worth

(including loans from

friends and relatives)

TOL / TNW

hat is the quality of your receivables? How many months’ sales do they represent? Can

you give an ageing of your receivables?

age amount Percentage to total

Less than one
month old
1 to 2 months old
2 to 3 months old
More than 3 months
old
Percentage
What is the quality of your finished goods inventory? Are they sold against order / as and

when produced? Are they kept in stock for long? How many months’ sales do they

represent?

What will be the time period between procurement of raw materials to realization of sale

proceeds? Can you cut short the cycle without increasing your liability?

Give the details of cost and the means of finance for your project

Item Why do What is Cost of How do you

you need the basis item proposed to
to of your aquire/procure
purchase cost? the item
the item?
Land
Buildings
Macinery
Other
items
What are the means of finance?

Means Amount FIVE DETAILS (BANK

SHOULD

BE SATISFIED ABOUT
YOUR

ABILITY TO PROVIDE THE

MARGIN)

From own sources

Bank loan

Friends and relatives

Others

Total

Has the project been vetted by consultancy cell of the Bank or consultants of repute?

Give details

What is the repayment period you are looking for the term loan? What will be the annual

cash accruals? What will be your liability towards payment of installments and interest on

term loan in a year? Whether the cash accruals will be sufficient to take care of the

repayment liability?

Anything else you would like to tell about your business

What is the collateral you would be able to offer? GIVE DETAILS

What is the collateral you would be able to offer? GIVE DETAILS

ITEM VALUE BASIS

TOTAL
Please tell us about your future plans

What is the level of sales you are projecting? Briefly describe the basis

What is the level of receivables you are expecting in terms of month’s sale?

What is the level of furnished goods inventory you are expecting to maintain in terms of

month’s sale?

I certify that all information furnished by me / us is true, correct and complete. I have no

barrowing engagement for the company / firm with any bank except as indicated in the

application form. There are no overdues / statutory dues owed by me or the firm/company. No

legal action has been taken against me / us firm / company. I shall furnish all other information

that may be required by Bank in connection with my application. The Information may also be

exchanged by you with any agency you may deem fit. You, your representatives of any other
agencies as authorized by you may at any time inspect / verify my / our assets, books of account

etc. in our factory business promises as give above. You may take appropriate
safeguards/action

for recovery of bank’s dues including publication of defaulters’ name in web site/submission to

RBI. I further agree that my loan shall be governed by the rules of State bank of India as may be

in force from time to time.

Place: For and on behalf of the company

Date: Signature of Chief Promoter / Chief Executive

LOAN APPRAISAL
ANNEXURE-II

ASST GENERAL MANAGER / CHIEF MANAGER: - FOR SANCTION

APPRAISAL MEMORANDUM UNDER SME SMART SCORE

Branch:

SEGMENT : C&I / SSI / SBF (Micro/Small Enterprises)

The proposal conforms to the extant instructions of the scheme. The scores awarded under
credit scoring criteria are as under

SEGMENT MIN. SCORE MARKS SCORED

Personal Details 15/30

Business Details (or) 25/50

Greenfield ventures

Collateral Conditions 10/20

Total Score 50/100

(To be eligible under the scheme, the unit should get a minimum score of 60% with a
minimum of 50% under each sub-head)
1. PROPOSAL FOR
I. Sanction of
a.
b.
II. Approval for
c.
d.
III. Confirmation of
e.
2. Details of Credit limits Rs.in lakhs
Facility Existing Limits Facility Proposed Limits
CC(Hyp) CC(Hyp)

SME Credit Plus SME Credit Plus

TL TL

LC/BG (As sub limit LC/BG (As sub limit

of CC(Hyp)) of CC(Hyp))
Total limits Total limits
3.Name of the Borrower

4.Name of Proprietor /Partners/Directors

5.Address

Factory

Office
SME BU Master Circular as on 31.03.2009
Page 14 of 14

6.Constitution Proprietorship/Partnership/ Private Limited

Company
7.Line of activity
8.Year of Incorporation
9.Banking with SBI since
10.IRAC Status
11.Details of Associate Concerns/Family

Concerns and their Bankers

Any NPA’s among associates?

12.Date of last sanction

(not applicable for fresh exposures)

13. Position of the account as on (Rs in lakhs)

Facility Limit M.V A.V D.P O/S Irregularity
if any

(Not applicable for new units)

14. Brief background & History :-( to be brief and in bullet points only)
(Comments on management, products, tie-up arrangement if any, quality
approvals/certifications etc)
15.Performance and financial indicators: Rs.in lakhs.
31 MARCH YR.BEFORE LAST CURRENT FOLLOWING

LAST YEAR YEAR YEAR

Audited Audited Estimates Projections

Domestic Sales

Export Sales

Net Sales

Profit After Tax

PAT/ Net Sales

(%)
Cash Accrual

Paid Up Capital

TNW

TOL/TNW(times)

Current Ratio
SME BU Master Circular as on 31.03.2009
Page 15 of 15

Comments on Financials ;( Brief bullet points only)

16.Term Loan:
Project Details Project Cost Rs.

Bank Loan Recommended Rs.

(As per assessment in annexure-III)

Debt /Equity

Comments:
19. Whether (a) the name(s) of the Individual/Directors appear(s) in RBI’s list of
defaulters/RBI’s list of willful defaulters & (b) the Individual/Directors name figures in
ECGC’s caution list
PARTICULARS LOCATION DATE
RBI Willful Defaulters
list(Non-Suit
Filed)Rs.25lacs and

Above
CIBIL List(Suit filed) Rs.25
lacs and above
ECGC specific approval list

20. Comments on I&A and other audit reports, which have an impact on credit risk on the
unit:, if any:
Name of report Date of report Serious irregularities/

Adverse features

remaining unattended
Comments in last I&A report
& its

present status

Company's audited Balance

Sheet

(Qualifications)

21. If the unit has scored less than 60% marks in any of the individual parameters in SME
Smart Score, please comment critically on those parameters (even though the aggregate score
may be more than 60%)

22. Recommendations;
Recommended for sanction of
Working Capital limit of Rs.
Term loan of Rs.
---------------------------
Total limit Rs.
On the terms and conditions as set out in Annexure-VI
Signature Appraised & Assessed by Sanctioned by

Name
Designation
 Date
Enclosure:
Applicant’s application.& others
Statement of Credit Score arrived as Annexure -I.

Controlled by

Signature

Name

Designation

Date

SME BU Master Circular as on 31.03.2009

Page 18 of 18
TERMS AND CONDITIONS
ANNEXURE-II-A
1. Facility
 Limit

2. Security

Primary WC:

TL:
Collateral

Personal Guarantee

(Indicate Net worth of

Guarantors with date of

compilation of opinion

reports)

3. Interest CC(HYP):

(Linked to SBAR) TL:

4. Margin(%) Stocks: Term loan:

Receivables:

Cover Period:

BG/LC (cash
Margins):

4. REPAYMENT CC(HYP):- Repayable on demand.

TL:

5. Validity of Sanction, Sanction valid for two years. A

review shall be made after 12
Review/Renewal
months.

6. Inspection Quarterly

7. Stock Statement To be submitted monthly.

8. Insurance

9. Processing fee

10. EM Charges

11. Commitment Charges CC(HYP):-

Term Loan:-
12. Penal Interest

Documents As per SME Documentation

13. Other Stipulations, if

any.

ASSESSMENT OF LOAN
ANNEXUREII-B

Name of the Borrower:

ASSESSMENT OF WORKING CAPITAL

I. For SSI, SBF and Retail traders:
Rs.in lakhs
1.Projected Turnover Estimated Projected
Method (Nayak Committee
Method) Ist year 2nd Year

for SSI
a. Estimated Sales for the
Current year
b. Working capital required
(25% of ‘a’)
Eligible Bank Finance (80% of
‘b’)
Bank finance Required (A)

2.Assessment as per
Traditional Method
Estimated Purchases in the
current Year
Estimated Average Raw
Material Holding at any time

(Calculated at cost of
Purchases)
Estimated Average holding of
Stock in process and Finished

goods at any one time

(calculated at cost of
Production)
Estimated Average Receivable
outstanding at any one time

Total Requirement
Less estimated average credit
enjoyed on purchases
Less estimated average credit
enjoyed on purchases
Less Other Sources like
unsecured loans, plough back
of profits

Etc
Bank Finance Required (B)

Working Capital
Assessed/recommended
A or B above which ever is
higher i.e

II.For Self Employed and Professionals

50% of Gross annual income as declared in their Income Tax return.

III.Comments on Production aspects: (covering location advantages, availability of raw

material and other utilities like water, power, fuel, labour etc.

IV.Brief Comments on Marketing Aspects:

V. i) Assessment of EPC limits: Rs.in lakhs

Sr. No Particulars Estimated Projected

Ist year 2nd year

1 Estimated Exports

2 Exports - at cost

3 Lead time and usance

period

(includes order
period /
manufacturing period
etc.)

4 No. Of Cycles in a
year

5 EPC requirement per

cycle

6 Less:- Margin on
EPC – %

7 Eligible Limit

8 EPC limit
recommended

ii) Assessment of EBD limits:

Sr. No Particulars Estimated Projected

Ist year 2nd year

1 Estimated Exports

2 Exports on
Usance bill basis

3 Usance period

4 Lead Time

5 No. of cycles in a year

6 Eligible EBD Facility

7 Limit requested by the

unit
8 Limit recommended

iii) Brief Comments on the above limits:

SME BU Master Circular as on 31.03.2009
Page 22 of 22
VI. Assessment of Non fund based limits:

i)Assessment of LC limits: Rs.in lakhs

Annual Raw Material purchases
Monthly Raw Material purchases
Monthly Raw Material purchases through LC’s
@ % (A)
Average Usance Period (B)
Lead Time and transit period (C)
Total of ‘B’ and ‘C’ (D)
LC limits required (= A X D)
Recommended LC Limits

Assessment of BG limits:

Outstanding BGs as on
Add: BG’s required during the next 12 months,
as under
1.Earnest Money deposit

2.Security Deposit

3.Advance Payment BG

4.Retention Money Deposit/Maintenance

Guarantee

5. Guarantees on account of sales tax,

commercial tax and excise duty payments
Less: Estimated maturity/cancellation of BG’s
during the period .
Requirements of BG’s
Recommended BG limit

Brief comments on requirements of above limits:

VII. Assessment of Term Loan:

1. Project Details Rs.in lakhs.

Project cost Cost Margin Margin amount Required Bank Finance
(%)

Land
&Buildings
Plant&
Machinery
WC margin
Contingencies
Total project
cost
Means of
finance
Own funds
Borrowings from

friends and
relatives
Bank finance
Others
Total means of Debt /Equity :
 finance

3. Details of capital expenditure i.e land and factory building as well as machinery
proposed to purchase:

4. Remarks on cost of project & means of finance (in brief)

5. Term Loan Assessment: Rs.in lakhs

Years 1 2 3 4 5 6

(Act) (E) (E) (E) (E) (E)

Net Profit
Depreciatio
n
Cash
Accruals
Repayment
obligations

(including
Interest)
DSCR
Average
DSCR

6. Project implementation schedule:

7. Comments on Commercial viability:

SME BU Master Circular as on 31.03.2009
Page 24 of 24
VIII) Term Loan assessment for Transport Operators (SRTO)
Cost of Vehicle/s Rs.
Borrower’s Margin ( %) Rs.
Term loan recommended Rs.

Assessment:
Earnings
1 Total No. of Kilometers to be run per day
(estimated)/ No. of

trips per day

2 Earnings per Km / earning per trip
3 No. of working days in a month
4 Total monthly earnings 1 x 2 x 3 …..A
Expenses
5 Cost of Fuel per litre
6 Quantity of fuel required per month
7 Cost of fuel per month
8 Monthly Wages / batta for driver / cleaner etc
9 Maintenance
10 Repair
11 Insurance (annual premium / 12)
12 MV Tax (annual tax /12)
13 Interest on borrowings
14 Sustenance
15 Other expenses
Total Monthly Expenses (5 to 15)….B
16 Monthly surplus …. A - B
17 Monthly TL repayment
18 DSCR 16/17

Brief details of above workings:

 CREDIT SCORING CRITERIA
ANNEXUREIII

Name of the Company / Firm :

Name of the chief promoter / chief executive:

(in case of partnership concerns, where the partners are having equal stake, the personal
profile of the active promoter as decided by the concern could be taken)

1. Personal details :
Sr.No. Parameters Maximum Marks Criteria Marks

marks Scored

1 Age 5 18 to 24 3

25 to 49 5

50 to 59 1

60 to 65 0
2 No. Of children 2 Upto 3 2
0
>3
3 Owining a house 5 Own 5
0
Not owning

house
4 Academic 4 Professional 4
qualifications 2
Graduate/PG 1
0
Metric

Below Metric
5 Experience in the line 5 > 5 years 5
of trade 3
2 to 5 years 0

< 2 years
6 Spouse details 1 Employed 1
0
Homemaker
7 Assessed for income 2 Assessed 2
tax
 Not assessed 0

8 Deposit account with 5 3 Yrs. & above 5

SBI 2
6 M to < 3 Yrs. 0
(min. deposit should
be Rs.10,000/- in the <6M
period under

review)
9 Have life insurance 1 Yes 1
policy No 0

MARKS SCORED 30

Minimum score should be 15 marks

SME BU Master Circular as on 31.03.2009

Page 26 of 26
2. Business Score :
2.(i) For existing units which have not so far availed any loan from the Bank. If takeover
from another Bank, takeover norms, prescribed by the bank are to be
first evaluated and fulfilled.

Sr. Parameters Maximum Marks Criteria Marks

No. marks Scored

1. Years in business 5 5 Years & over 5

3
3Years to < 5 1
1 year to < 3
2. Continuous net 5 Last 3 years 5
profits (before 3
Last 2 years 1
tax)
Last year
3. Sales show a rising 5 Last 3 years 5
trend 3
Last 2 years
4. Factory premises 3 Owned or over 5 3
0
years of lease

Rented
5. Know-how 2 Specialised 2
0
Common

6. Line of activity 1 Priority Sector 1

0
Non priority
7. Competition 4 Low 4
2
Medium 0
High
8. TOL/TNW (quasi 5 2 & Below 5
equity to be 4
> 2 but upto 3 2
added to TNW and 1
reduced from > 3 but upto 4

TOL) > 4 but < 5

9a. Quality of 5 Upto 3 months 5

receivables of

sales

> 3 but upto 4

1
months of sales
0
> 4 months of
sales
9b. Quality of finished 5 Upto 1 month of 5
goods
sales 1
inventory
> 1 but upto 2
0
months of sales

> 2 months of
sales
10. Repayment period 5 Upto 3 years 5
(not applicable 3
> 3 to 5 years 0
for only working
capital loans) > 5 years
 11. Gross DSCR (not 5 >2 5
applicable for 2
1.5 To 2 0
only working
capital loans < 1.5

MARKS 50
SCORED

Items 10 & 11 are not applicable for working capital loans alone. In that case the
score should be normalized for 50 (marks scored/40)*50
Minimum score should be 25

2(ii). For Greenfield ventures :

Sr. Parameters Maximum Marks Criteria Marks

No. marks Scored

1. Branch is in the know of business 10 Yes 10

No 0
(includes cases where the project

is appraised by consultants of

repute)
2. Manufacturing/servicing/trading 5 Yes 5
No 0
process is well known to
applicant

to produce/service/trade the

required quality and quantity of

the product
3. Location advantage 2 Yes 2
No 0
4. Availability of utilities including 2 Easy 2
Ok 0
labour
5. Firm’s capacity to sell the product 5 Good 5
Ok 0
at the price and quantity
6. Line of activity 1 Priority 1
0
 Sector

Non priority
7. TOL/TNW (quasi equity to be 5 1 and below 5
4
added to TNW and reduced from > 1 upto 2 3
TOL) Competition > 2 upto 3 0

>3
8a. Quality of receivables as per 5 Upto 3 5

Projections months of

sales 1

> 3 but upto

4
0
months of

sales

> 4 months
of

Sales
8b. Quality of finished goods 5 Upto 1 5
month
inventory as per projections
of sales 1
> 1 but upto
2

months of 0

sales

> 2 months
of
9. Repayment period (not applicable 5 Upto 3 years 5
3
for only working capital loans) > 3 to 5
years 0
> 5 years
sales
10. Gross DSCR (not applicable for 5 >2 5
2
 only working capital loans 1.5 to 2 0

< 1.5
MARKS SCORED 50 / 40

Minimum Marks : 25 out of 50

SME BU Master Circular as on 31.03.2009

Page 29 of 29
3. Collateral conditions:

Sr. Parameters Maximum Marks Criteria Marks

No. marks Scored

1. Equitable Mortgage of 15 75% and over 15

property :
50% to <75% 10
Value of property (if
25% to <50% 5
TDR or
 cash equivalent is <25% 3
offered as
NIL 0
security multiply cash
equivalent

by 2 and add to the

collateral

value) / loan amount

(%)
2. Residential property as 5 Yes 5
part of 1
No 0

MARKS SCORED 20

Minimum Marks are 10 (except in cases where Collateral should not be asked as per Bank’s
norms, where the minimum marks will be NIL)

Appraised by Approved by

Name
Date

SME BU Master Circular as on 31.03.2009

Page 30 of 30
RENEWAL PROPOSALS
ANNEXURE-IV
\
FORMAT FOR ANNUAL REVIEW /RENEWAL OF LOANS
SANCTIONED UNDER SME SMART SCORE
PROPOSAL FOR REVIEW OF WC AND TERM LOAN SANCTIONED UNDER ‘SME
SMART SCORE' SCHEME.
1.Name of the unit Proprietorship/Partnership/Private limited
Company
2 Constitution
3.Name of the

Proprietor/partners/

/directors
4. Business Address

Phone/Cell No.
5.Nature of activity
6. a).Date of Last

Sanction/review

b) Sanction is Valid up to
7. IRAC Position as on
8.Present Position of Facility Limit DP O/S Irregul

Accounts as on date CC

(Rs. In lakhs) TL
LC/BG

Comments on Conduct of above accounts:

SME BU Master Circular as on 31.03.2009
Page 31 of 31
9.Financial parameters

(Rs. In lakhs) Year Earlier Actual Estimated

Estimated
achieved (Current
(previous
(previous year)
year)
year)

Net sales
PBT
Cash

Accrual
TNW
TOL/TNW
CR

Comments( to be commented on actuals for deviations over

estimates, if any)

9. Conduct of WC a/c Annual Turn over estimated Rs.

(Rs. In lakhs) Annual Credit Summations in the account Rs.

Value of the account: Rs.

(Interest/Exchange/commission Booked)

Cross selling Products Booked :

 (Give the name of the products booked)

Retail Business Booked

Number of retail loans and amount booked for the

promoters/employees :
10. Whether earlier sanction

terms complied with.

11. Whether irregularities

observed in I&A report

rectified.?

If not present status

12.Other Comments

( from Risk Angle)

(On associates, conduct of

accounts, Competition,

quality of products, CIBIL

report for individuals or

corporate as applicable etc.,

and other relevant risks.

Bullet points only)

SME BU Master Circular as on 31.03.2009

Page 32 of 32

14. Recommendations
The Conduct of WC loan and Term loan has been reviewed and found satisfactory. The
Credit Score for renewal of limits is as per annexure –I, is satisfactory.

1.Recommended for continuation of Working Capital limit of Rs.

2. Recommended for release of additional working capital limit of Rs. as per the original
sanction on (give date) for the projected year-----

On the above terms and conditions as already set out in the original sanction dated—

Appraised by Approved by

Signature

Name

Designation

Date

SME BU Master Circular as on 31.03.2009

Page 33 of 33

Credit Scoring Model for Renewal proposals

Sr. Parameters Maximum Marks Criteria Marks

No. marks Scored

1. Actual sales/projected 10 90% & above 10

sales 70% to < 90% 8

50% to < 70% 5

Below 50% 2

2. PBT/NS (%) 10 Increasing 10

Flat 5

Decreasing 1
3. Change in TOL/TNW 5 Decreasing and upto 3 5

during the year Decreasing but above 3 3

Increasing but upto 3 3

Increasing but above 3 0

4. Overall conduct of the 15 Excellent 15

account and working of Good 10

the unit OK 0
5. Credit summations in the 10 90% & above 10

account during the 70 – 89% 7

preceding 12 months 50 – 69% 5

< 50% (% of sales) NIL

Marks scored 50

Minimum Marks should be 30/50

Veto Power if the account is unsatisfactorily conducted
i) cheques are frequently returned
ii) debit balance (outstanding) is over the drawing power for over 160 days in the
year
iii) non-compliance of critical terms and conditions
(frequent devolvement of LCs and invocation of guarantees/non receipt of stock
statements etc. have not been mentioned as they would be reflected in ii)
Appraised by Approved by

Name

CIRCULAR REFERENCES ANNEXURE-V

PDM/264 dated February 13, 2002

PDM/Circular no. 1 of 2003-04 dated April 3, 2003

SME/SV/Cir-15 /2005-06 dated December 21, 2005

SME/SV/Cir-23 /2005-06 dated March 25, 2006

Sme /knp/ 714 dated December 7, 2007

Sme /knp/ 1116 March 28, 2008

SME BU Master Circular as on 31.03.2009
Page 35 of 35