Looking for a Small Business Loan for MSME Contractors from Indian Bank?

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Indian Bank IB Contractors Scheme

This loan helps MSME contractors and sub-contractors meet their fund-based and non-fund based working capital and capital expenditure requirements. Indian Bank offers this loan scheme as a working capital loan, term loan, Letter of Credit, Bank Guarantee, etc. The maximum loan amount is Rs. 5 crore for this loan.

Features of IB Contractors Loan Scheme

Why this Loan?

  • The Indian Bank IB Contractors loan is meant for contractors and sub-contractors to meet their working capital and capital expenditure needs
  • Contractors and sub-contractors who are classified as MSME and work on Civil, Mining and Construction projects are eligible for this loan if they are performing contracts for the central government, state government, reputed Public Sector Units (PSUs), reputed Corporate entities, etc.

Loan Amount

  • The maximum loan amount sanctioned under this loan is Rs. 5 crore

Interest

  • The interest rate for this loan is defined as the sum of one-year MCLR of the bank and Credit Risk Spread. As of now, the MCLR of Indian Bank is 7.30% and the Credit Risk Spread, as the name suggests, depends on the credit risk rating of the borrower. It can range from 1.10% to 6.10%, making the effective interest rate range anywhere from 8.40% to 13.40%

Repayment

  • The term loan needs to be repaid within 7 years whereas working capital loans must be repaid within 12 months

Security Needed

  • The bank asks for hypothecation of assets financed by the bank under this scheme as primary security for the loan
  • The bank may ask for collateral such as Land or Buildings for the term loan
  • The bank may also ask for additional security on a case-to-case basis

Eligibility

  • Contractors and sub-contractors in the MSME category belonging to the Civil, Mining and Construction sector are performing contracts for the central government, state government, reputed Public Sector Units (PSUs), reputed Corporate entities, etc. are eligible for this loan
  • They must have been in the business for at least 3 years and earning net profit at least for the last 2 years

Borrower Contribution to Total Cost (Margin Money)

  • The bank charges up to 20% margin on this loan

Note: Margin money refers to the amount the borrower contributes to the overall amount required. The bank will cover the rest.

Processing Charges

  • The processing charges levied on this loan are not available on the bank’s website. We suggest calling a bank customer care number to know more details

Documents Needed for Individuals

  • Loan Application Form duly filled and signed by the applicant and co-applicant, if any
  • Two Passport Size Photographs of applicant and co-applicant
  • Personal ID Proof: Aadhaar Card, PAN Card, Passport or Driving License. PAN Card/ PAN Card Issuing Letter is must
  • Signature Proof: PAN Card, Banker’s Verification, Driving License or Passport
  • Residential Address Proof (Any One): Aadhaar Card, Electricity Bill, Post-paid Phone Bill, Valid Rent Agreement
  • Income/Banking Proof: Last 6 months Bank Account Statement of applicant and co-applicant, Loan Statement of Running Loans, Latest Closed Loan NOC, Net Worth of the applicant and co-applicant
  • Security (as applicable): Margin Money, Previous and Current Sales Deed, Plant and Machinery list, Plant and Machinery Current Valuation Report, Property Photographs, Previous Property Search and Valuation Report
  • A4 size copies of the aforementioned documents

Documents Needed for Proprietorship and Partnership Firms

  • Loan Application Form duly filled and signed
  • Partnership Deed and Partnership Registration Certificate
  • ID Proof of the Firm: Firm PAN Card or PAN Issuing Letter
  • Office Address Proof: Electricity Bill, Post-paid Phone Bill, Valid Rent Agreement
  • Income Proof: CMA Data and Project Report, Debtors and Creditors Certificate, GST Return, Last 3 years ITR of applicant and co-applicant, Audited or CA Certified Computation of Income/Trading Account/Profit and Loss Account/Balance Sheet, Annual Audit Report and Tax Audit Report if audited, Form 16A if applicable, Net Worth of applicants, co-applicants and guarantors
  • Banking Proof: Last 1-year Statement of Company’s Major Account, Current Account, Cash Credit Account, Overdraft Account, Loan Statement of Running Loans, Latest Closed Loan NOC and Last 6-months Bank Statement of Applicant and Co-applicant’s Savings Account
  • Security (as applicable): Margin Money, Previous and Current Sales Deed, Plant and Machinery list, Plant and Machinery Current Valuation Report, Property Photographs, Previous Property Search and Valuation Report
  • Other Relevant Documents: Partnership’s Business Profile, Promoter/Guarantor’s Profile, Corporate Brochure, Business Experience Supporting Documents, Business References
  • All A4 size copies of the aforementioned documents

Documents Needed for Private Limited and Public Limited Companies

  • Application Form duly filled and signed
  • Company ID Proof: Company’s PAN Card
  • Office Address Proof: Electricity Bill, Post-paid Phone Bill, Valid Rent Agreement
  • Business Proof: AOA and MOA, Company Incorporation Certificate, Business Commencement Certificate, Board Resolution, CA/CS verified Share Holding Pattern, ROC Annual Return, DIN Certificate, List of Directors on Company Letter Head, GST Number, Form 32 in case of Director Change
  • Income Proof: CMA Data and Project Report, Last 3 Years ITR Acknowledgement copy of Company and all Directors, Last 3 Years Annual Credit Report or Tax Audit Report with Article 3CB, Article 2D, Article 3CD, TDS Certificate/Form 16A, Net Worth Certificate
  • Banking Proof: Last 1-year Statement of Company’s Major Account, Current Account, Cash Credit Account, Overdraft Account, Loan Statement of Running Loans, Latest Closed Loan NOC and Last 6-months Bank Statement of Applicant and Co-applicant’s Savings Account
  • Security (as applicable): Margin Money, Previous and Current Sales Deed, Plant and Machinery list, Plant and Machinery Current Valuation Report, Property Photographs, Previous Property Search and Valuation Report
  • Other Relevant Documents: Company’s Business Profile, Promoter/Guarantor’s Profile, Corporate Brochure, Business Experience Supporting Documents, Business References
  • All A4 size copies of the aforementioned documents

Reference Facts

  • Indian Bank Website: www.indianbank.com
  • Headquarters: Chennai, Tamil Nadu
  • Call Centre Toll-Free Number: 1800 425 00 000, 1800 425 4422