Processing loan by bank for working capital

jaimin shah (Finance Manager) (111 Points)

03 April 2012  

Example:

Processing Charge on working capital by bank :0.40% of limit or maximum 20 lac

 

Working Limit: 4.5 Crore original

Enhanced Working Limit: 7.5 Crore (Revised)

 

Query:

My query is that bank should charge processing fees on new working capital limit of 7.5 crore or only on the enhanced limit 3 Crore (7.5 new-4.5 old)??

and  if charge on 7.5 then what is logic behind that??? urgent..