Looking for an MSME loan for your business from Union Bank of India?

You have landed at the right place. This page contains all the information you will need on Union Bank of India’s Union High Pride Scheme.

Union Bank of India Union High Pride Scheme

This loan helps businesses in the MSME sector meet their capital expenditure and working capital requirements. Proprietorships, partnerships and limited companies in the manufacturing and services sector that fit SME definition are eligible for this loan. The maximum loan amount sanctioned under this loan is Rs. 2.5 crore.

Features of Union High Pride Scheme

Why this Loan?

  • This Union High Pride Scheme is meant for small businesses in the SME sector who need financial assistance to meet their working capital and capital expenditure needs such as purchase of office unit, construction of office premises and purchase of machinery / equipment / vehicles for business use
  • Only the borrowers with a credit rating of CR-1/UBC-1 to CR-3/UBC-3 or equivalent are eligible for this loan

Loan Amount

  • The maximum loan amount sanctioned under this loan is Rs. 25 crore

Interest

  • The interest rate for this loan is defined as 1.00% less than the interest rate applicable to MSMEs which is sum of External Benchmark Lending Rate (EBLR)/Marginal Cost of Funds based Lending Rate (MCLR) of the bank and Strategic Spread. The Strategic Spread depends on various factors such as quantum of loan and type of borrower
  • Loans upto Rs. 2 lakh: The interest rate for this loan is equal to the EBLR of Union Bank of India. Currently, it is 6.80%
  • Loans from Rs. 2 lakh Rs. 25 lakh: The interest rate for this loan is EBLR + 0.75% for micro enterprises and EBLR + 1.00% for small and medium enterprises. Currently, the EBLR rate is 6.80% bringing the effective interest rate at 7.55% for micro enterprises and 7.80%
  • Loans from Rs. 25 lakh to Rs. 1 crore: The interest rate for this loan is MCLR + 1.65% for micro enterprises and EBLR + 4.00% for small and medium enterprises. Currently, the MCLR rate is 7.20% bringing the effective interest rate at 7.55% for micro enterprises and 7.80%
  • Loans from Rs. 1 crore to Rs. 25 crore: The interest rate for this loan is MCLR + 0.75% for micro enterprises and EBLR + 4.50% for small and medium enterprises. Currently, the MCLR rate is 7.20% bringing the effective interest rate at 7.95% for micro enterprises and 11.70%
  • The bank may offer a concession of 0.25% on the interest rate if the credit risk rating of the borrower is BBB and above and collateral coverage of 100% or above is provided for the loan

Repayment

  • Working Capital Loans: These loans must be repaid within 12 months
  • Term Loans: These loans need to be repaid in 7 years including moratorium

Security Needed

  • The bank asks for hypothecation of assets acquired with the bank finance
  • The bank asks for collateral security covering at least for this loan

Margin Money (Borrowers Contribution to Total Cost)

  • The bank charges 20% of total cost as margin money

Processing Charges

  • This information is not available on the bank’s website. A bank representative will be able to answer these questions, we suggest calling them for 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

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

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

Reference Facts:

  • Union Bank of India Website: www.unionbankofindia.co.in and www.unionbankonline.co.in (net banking)
  • Headquarters: Mumbai, Maharashtra
  • Call Centre Toll-Free Number: 1800 2222 44, 1800 208 2244