It contributes 8 percent of the country's Gross Domestic Product, 45 percent of the manufactured output and 40 percent of its exports. The Rural Self-Employed Business Loans provide employment to about 60 million persons through 26 million enterprises.
In recent years, Business Loans in the rural markets have consistently registered higher growth rate compared to the overall industrial sector. With its agility and dynamism, the sector has shown admirable innovativeness and adaptability to survive the recent economic downturn and recession. Thus, financing Rural Enterprises are important for the national objectives of growth with equity and inclusion.
Tamil Nadu accounts for the largest number of (15.07 Percentage) in the small business enterprise segment in the country with 6.89 lakh registered entities, producing over 8,000 varieties of product for a total investment of more than Rs. 320 billion.
There is significant number of small businesses operating in the rural catchment catering to the requirement of the adjoining villages. These businesses are small private enterprises, partnership chains which employ a few paid workers, proprietors who own and operate one person businesses or with the help of unpaid workers - mostly family members and daily paid workers paid largely in cash.
The product features combo of Traditional Credit clubbed with Technology to speed up the end-to-end process. We cater customers who have availed loans from us and Gold Loans from other financial institutions and Hand Loans from local financiers, our business loans will help them to reduce the interest burden and improve profit margins.
Simplified process with adequate checks thus ensuring adequate.
Our documentation, process, policies have got the right mix of.
Customers KYC and business proof would be checked digitally and by
To be prepared by our Business Team. He should be adequately
|1) Application Form|
|4) Proof of ownership documents|
|5) Business Proof / YIB|
|6) Income documents|
|7) Bank Statement|
|8) Original Seen and Verified|
|1) Loan Agreement||Loan Agreement duly signed by applicant / co-applicants.|
|2) Repayment Instrument||ACH / NACH / any other approved digital mode Repayment through ACH from bank account which was provided for appraisal and disbursal. E-NACH and other digital mode of payments preferred and to be insisted.|
|3) Security PDC -2 nos.||For all customers choosing NACH mode of payment, customer's signature verification to be obtained through banker. Two Security PDC's to be obtained from the customer - one for the entire loan amount and second as blank in favour of Orange Retail Finance duly signed but undated for security. Signature provided by the customer should match with one of the KYC documents provided. Any mismatch in the signature can be validated through self-declaration by the customer and verified by the BDE / BDM.|
|4) Insurance||Only for Applicant|
|Eligibility||Minimum Loan Amount: Rs. 20,000/- and Maximum Loan Amount: Rs. 1,00,000/-Minimum Tenor - 12 months and Maximum Tenor - 24 months|
|Age Criteria: Minimum age at the time of enrolment: Maximum age at the time of loan maturity||Co-borrower 21 65||Borrower 18 65|
|Co-Borrower Criteria||It is mandatory to have a Co-borrower in the loan agreement and the following relationship only
qualifies to be a co-borrower.
Applicant & Spouse
Applicant & Father / Applicant & Son
Applicant & Mother / Applicant & Son
To be substantiated by proper relationship proof
|Years in Business||Applicant should be running the same business for at least 2 years.|
|Ownership of Property||Applicant should own a residential or shop property in the branch service area. The ownership can be in the name of the customer/spouse/parents. The residence should be within the same service area of the Branch and the shop can be located within the same organisation limits. The residence or shop premises should be owned by the customer/ spouse/ parents and the customer shall submit the proof for the same business shall be run in a permanent building with RCC/Tiled/Sheet roof. Conditions for Residence-cum-Office Profiles: 1. Rented Residence-cum-Office not allowed. 2." No Business activity seen" or commission agent is not allowed to be funded in case of RCO set up. 3. Clear demarcation of office and residence to be there and should be confirmed by the verifier (Business Manager) and snapshot in support of the same to be documented 4. Minimum years in business should be more than 3 years for Residence-cum-Office profiles as against 2 years as per policy.|
|Credit Bureau Parameters||Bureau report to be extracted for all the loans. In case of any lack of information in Bureau report.
Highmark Combo CRIF report to be extracted.
The following conditions are to be met :
Credit Score to be >=600
|Banking Vintage and Average Bank Balance requirement||Current bank account or Savings bank account with 1-year vintage reflecting business transactions can be considered for evaluation. Average Bank balances for last 3 months to be equal to 1 time of proposed EMI amount. ABB 1:1ABB would be calculated as average of closing balance as of 1st, 5th, 10th, 15th, 20th, 25th for last 3 months to be calculated .Any huge credit due to loan proceeds and 1 time receipts to be ignored from ABB calculation|
Business loan is given for Entities like proprietorship, partnership, private limited company or public limited company who are eligible for this type of borrowing. The usage of a business loan is left to the discretion of the borrower and can be used for working capital purposes, meeting short-term cash flow requirements.
Loan eligibility depends A. The credit score of the entity and/or the partner/director/proprietor of the borrowing entity as reflected in your Credit Bureau report. B. The last 2-year financials of the entity. Factors like turnover, partner/director salary, depreciation, the interest cost, net profit after tax are some of the key parameters that go into deciding the loan amount. C. Ability to service the EMI for the current loan be requested as depicted by the Debt service coverage ratio (DSCR).
Generally, the minimum loan amount is Rs. 1,00,000 and maximum amount is Rs. 4,00,000, based on the business requirements.
Sanction happens in 10 minutes, Post-document verification loan is disbursed.
Borrowing entity's PAN card, address proof, last 2 years financials (balance sheet, profit & loss, audit report), last 6 months bank statement, GST/Service Tax returns, partnership deed/MOA, existing loans repayment track record. Additionally, the partner/director's PAN Card, KYC, own house proof, ITRs etc. On case-to-case basis additional documents may be required.
All business loan repayments happen in the form of an EMI (Equated Monthly Instalment). The customer needs to give few PDCs (Post-dated cheques) and sign an ECS mandate.