The Tamilnadu Industrial Investment Corporation Ltd
(A Government Of Tamil Nadu Undertaking)
Funding Success...

Contractors Credit Scheme


To extend financial assistance to Class I & II categories of approved contractors of State Government and State Government Agencies for meeting their working capital requirements to execute the civil, mechanical and electrical and other work orders entrusted with them.  


  • Registered Class I & II contractors of State Government / State  Government Agencies – both MSME and Large Enterprises.
  • The unit should be in existence and in operation for the past two financial years.
  • Units should have earned cash profit for the last two financial years.
  • The networth of the units should be positive.
  • The units  already assisted by the Corporation shall be in standard assets category continuously for the last two financial years.
  • Units which are having loans with the other Bank/FI’s should be in standard category with the respective institutions continuously  for the last two financial years.
  • CIBIL  report about the promoters / unit shall not be adverse and CIBIL score shall be as per norms.


The purpose of the loan is to provide working capital funds against the work orders issued by State Government / State Government Agencies.

Project Cost

Total cost of the work as indicated in the work orders (more than one work order can be considered) will be taken and then the cost of materials supplied and any advance given by the work issuing authority shall be deducted therefrom to arrive at the project cost.

Quantum of Assistance

Loan shall be 75% of the total project cost ie.,  work order/s value less the cost of materials supplied  and any advance given by the work issuing authority.

The minimum quantum of assistance shall be Rs.20 lakh and maximum quantum of assistance shall  be Rs.5 crore for limited companies and Rs.2 crore for proprietary / partnership firm.

If a contractor seeks additional loan,  based on fresh work orders, during the tenancy of current loan, the same may be considered subject to the ceiling limit per contractor as indicated above.

Promoter’s Contribution

25% (Minimum)

Debt Equity Ratio

2.00 : 1.00 (Overall)

Validity of Sanction

The first disbursement should be made within three months from the date of sanction.  The loan can be revalidated by the Regional Manager concerned for a further period of three months. Beyond six months, the proposal has to be appraised afresh.


i. The repayment period shall be flexible subject to a maximum of 5 years including a moratorium of 6 to 18 months depending upon the nature and tenure of the work order  and the repayment shall be in monthly instalments.

ii. Repayment shall not exceed 12 months beyond the tenure of the project.

iii. Repayment period will be fixed within the above norms and  in consultation with the contractor.

Preclosure Premium

Preclosure premium shall not be charged under the scheme.

Collateral Security

Collateral security to the extent of 150% of the loan sanctioned shall be stipulated.

Agricultural land will not be accepted as collateral property.  Further all other existing norms for collateral security for working capital term loans shall be made applicable under this scheme.  Fixed Deposit shall not be accepted as collateral security. Third party collateral shall not be accepted except properties offered by relatives.  The collateral property situated within Corporation / Municipal Town limits only shall be taken. Property within Panchayat limits lying in Chennai, Kancheepuram and Tiruvallur districts may also be accepted.

Valuation of collateral security will be undertaken by a Committee  comprising of jurisdictional (where the property is located) Regional Manager, Branch Manager & LAO apart from panel valuers as per norms.

Personal guarantee of all the Promoters / promoter Directors / collateral owners shall be extended for the loan.  Professional Directors / Employee Directors not having any shares / stake in the company / concern would be exempted.

Sanctioning Authority

Initially, for all loans under the scheme, to ensure speedier sanctions / closer scrutiny of proposals, the competent sanctioning authority irrespective of quantum of loan outstanding shall be RLSC.

A quarterly report will be placed before the Board in respect of the sanctions made by the RLSC to monitor the performance of the scheme.

Renewal of the Loan

The loan shall not be renewed.  Any further assistance under the scheme can be considered against fresh application only.

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