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SMP Initiative for Special Loan Scheme for Practicing CAs

Posted on 16 October 2010,    
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An Initiative of the Committee for Capacity Building of CA Firms and Small & Medium Practitioners, ICAI …….

 

 

The Committee for Capacity Building of CA Firms and Small & Medium Practitioners, ICAI is set up to promote capacity enhancement of members and firms through Networking, Merger and raising core competency of CA professionals.

 

 

The Committee has taken a major initiative to arrange financial assistance to all members in practice / firms in the form of specially designed loan scheme through Corporation Bank. Through the scheme, eligible Chartered Accountants can avail finance for setting up of offices including cost of furniture/fixture/office equipments-computers and other accessories. The scheme would also enable the Chartered Accountants to finance a part of the working capital for building their profession and will also take care of the needs of fresher (CAs with experience below three years).

 

 

* Members & firms are requested to avail the benefits of this loan scheme. For further details, please contact nearest branch of Corporation Bank.

 

 

Highlights of the loan scheme are given below: Eligibility:

 

 

 Chartered Accountants, individually/jointly or Proprietorship Concern or a Partnership Firm/ Partnership with Limited Liability

 

 Age of the individual/ proprietor shall not exceed 65 years.

 

 The applicants/Firms are registered with Institute of Chartered Accountants of India (ICAI) and also holding valid certificate/license for carrying out the practice.

 

 The applicant’s/firm’s name shall not appear in the RBI defaulters list/CIBIL report.

 

 In case of Firms, all partners shall join as co applicants.

 

 The applicants/firms should not have been subjected to disciplinary action by the Institute.

 

Purpose:

 

 For construction of office premises

 

 For acquisition of ready built new office premises, partly or fully constructed

 

 To finance cost of land and construction thereon

 

 To finance cost of furniture & fixture, fittings of office equipments/computers/other accessories etc.

 

 To finance working capital and /or financing receivable

 

 

Nature of facility:

 

Demand Loan/Term Loan for acquisition of fixed assets and/or Cash Credit/Overdraft for working capital

 

Margin:

 

A. For Term Loan/Demand Loan: Uniform margin of 20%

 

B. For Working Capital: 25% for Book Debts/Receivables for cash credit or clean overdraft

 

 Value of land shall not exceed 50% of project cost in case of purchase of site and construction of premises

 

Quantum of loan:

 

Applicable For Freshers: ( Experience below 3 years)

 

 

Metro

Urban

Other Centres

I.

Maximum eligibility: TL/DL * Out of which:

Rs. 20 lacs

Rs. 15 lacs

Rs. 10 lakhs

a.

For office premises

Rs. 15 lacs

Rs. 12 lacs

Rs. 8 lacs

b.

For furnishing & Other assets

Rs. 5 lacs

Rs. 3 lacs

Rs. 2 lacs

II.

For Working capital requirement

Rs. 2 lacs

Rs. 1 lac

Rs. 1 lac

 

 

Applicable For Existing Firms (Having Practice for 3 Years And Above)

 

A] WHERE LATEST GROSS ANNUAL INCOME IS UPTO RS. 5 LACS (income includes professional fees/consultancy fees etc..)

 

 

Metro

Urban

Other Centres

I

Maximum eligibility : TL/DL * Out of which:

Rs. 30 lacs

Rs. 20 lacs

Rs. 15 lakhs

a

for office premises

Rs. 20 lacs

Rs. 15 lacs

Rs. 12 lacs

b

For Furnishing & Other assets

Rs. 10 lacs

Rs. 5 lacs

Rs. 3 lacs

II

For Working capital

Rs. 2 lacs

Rs. 1 lac

Rs. 1 lac

 

 

B]  WHERE LATEST GROSS ANNUAL INCOME IS ABOVE RS. 5 LACS & UPTO RS.10 LACS AS PER LATEST IT RETURN (with experience of 3 years and above)

 

 

Metro

Urban

Other Centres

I

Maximum eligibility: TL/DL * Out of which:

Rs. 50 lacs

Rs. 25 lacs

Rs. 20 lakhs

a

For office premises

Rs. 40 lacs

Rs. 20 lacs

Rs. 15 lacs

b

For Furnishing & Other assets

Rs. 10 lacs

Rs. 5 lacs

Rs. 5 lacs

II

For Working capital

Rs. 5 lacs

Rs. 2 lacs

Rs. 2 lacs

 

 

C ] WHERE LATEST GROSS ANNUAL INCOME IS ABOVE RS.10 LACS, AS PER LATEST IT RETURN

(WITH EXPERIENCE OF 3 YEARS AND ABOVE)

 

 

Metro

Urban

Other Centres

I

Maximum eligibility : TL/DL * Out of which:

Rs. 125 lacs

Rs. 65 lacs

Rs. 30 lakhs

a

For office premises

Rs. 100 lacs

Rs. 50 lacs

Rs. 25 lacs

b

For Furnishing & Other assets

Rs. 25 lacs

Rs. 15 lacs

Rs. 5 lacs

II

For Working capital

Need based

 

 

 

 

 

 

Security:

 

a. Term Loan /Demand Loan: Assets acquired out of the loan.

 

b. For Working Capital Loan: Assignment of Book Debts/Receivable.

 

c. Collateral security: Suitable third party guarantee or Tangible securities.

 

Repayment:

 

 Term Loan - Repayable in maximum period of 10 years by EMI/PMI, initial moratorium of upto 18 to 24 months.

 

 Demand Loan - Repayable in maximum 3 years by EMI/PMI, including initial moratorium of 6 months.

 

 Repayment to commence from date of commercial operations or after completion of initial repayment holiday or as per the terms of sanction.

 

 Interest shall be serviced as and when debited.

 

Rate of interest:

 

Upto Rs. 10 lacs – Min. 10% (Base Rate + 2.25%)

Above Rs. 10 lacs – Min. 10.75% (Base Rate + 3%)

(Investment in fixed assets less than Rs. 100 lacs)

Above Rs. 10 lacs – Min. 11.75% (Base Rate + 4%)

(Investment in fixed assets above Rs. 100 lacs)

 

* Subject to gradation of the borrower

 

 Rate of interest at floating rate linked to Base Rate

 

 Rate of interest is subject to review

 

Note: Concession of 0.50% extended, if additional collateral security viz., property, LIC policies, Deposit etc., to the extent of 25% of loan amount is provided.

 

Processing Charges:

 

0.25% of loan amount subject to a minimum of Rs.5000/-

 

Prepayment charges:

 

-Nil



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