The product is to support

a) an applicant’s genuine need for the shift

b) in cases where a high cost borrowing has been resorted to from any source like Banks, Financial Institutions, NBFC, Private Equity, Angel investors, the market/multanis etc. for genuine business needs.

c) To start with, this product is meant for MSMEs only. Units in the services sector are not being considered now.

• Inadequate funding as compatible to the actual needs.
• Lack of inordinate delay in responding to requests
• Unsatisfactory packaging/unattractive norms to the applicant
• There could be adverse reasons like irregularity in account, non-satisfaction of basic financial/performance parameters.  In such cases, TIIC will not entertain any request for the takeover of the relative loan.

Resorting to high cost borrowing from channels (other than banks) like NBFC, Market (Multanis) may have happened due to cases like

• Cash flow inequalities, humps.
• Inadequate funds, unanticipated financial needs
• Investment declining in value not generating anticipated funds
• Such high cost borrowings will be with shorter tenure and lack of assets as ‘Primary Security’, the security shall be personal guarantee & non-business assets and with high rate of interest.
• Diversion of funds leading to liquidity crunch.
• Applications which involve such borrowings caused by adverse reasons, continuous losses, non-viable project, mis-management, unwise diversion and similar negative reasons will not be entertained for any reason whatever be the collateral offered.

a. The reasons for shifting from their present banks should be     acceptable.

b. They could be the Corporation’s clients or non-clients.

c. The constitution could be Proprietary, Partnership, Companies or Co-op. Societies.

1. They should have been in existence for 3 years.
2. The promoters should be credit worthy, financially sound and possess good managerial capability.
3. Their project should be viable.
4. Their accounts must be in the ‘Standard  asset’ category for atleast 3 years. Non-performing assets will not be taken over; the related high cost borrowings  will also be not considered for any replenishment of loan.
5. The units should have registered cash profits in the last 3 years.
6. Credit rating should be TIIC-PB and more.
7. The applicant unit should not have been restructured or rescheduled in the preceding three years.
8. The repayment period /schedule of loan shall be fixed as per the assessment of the Corporation independent of the repayment period / schedule given by the Bank / Financial Institution.
9. The Corporation may take over working capital limits extended by the commercial Banks/Financial Institutions along with Term Loan if the limits are within the maximum WCTL permissible.
10. The unit shall have a minimum positive net worth of 50% of its paid up capital and free reserves after taking into account the accumulated loss.
11. The application of units where the projects undertaken by them have not been completed will not normally be taken over.
12. The unit’s production / sales performance should not be in a bad state of stagnation or decline nor should the unit show any sign of loosing market.

The quantum will be the least of the following:

a) 75% of the value of fixed assets financed by the previous financier  or

b) The loan outstanding with the Bank / Financial Institution whichever is least subject to a minimum amount of Rs.25 lakh.

i)  In case of working capital limits, the actual outstanding with Bank

ii)  In case of replacement of high cost borrowing, the actual outstanding

iii)  Maximum Loan                 –         Rs.10 Crore

Minimum Loan                  –         Rs.25 lakh

a) All securities as offered by the applicant for his existing loan will be switched to TIIC and additional security if required to meet shortfall as per the norms of the Corporation.

b) A fresh revaluation may be done by TIIC for primary & collateral security to assess risk coverage.

c) Where the unit is unable to shift the existing security to TIIC, we may accept alternate security with the permission of sanctioning authority.

d) Personal guarantee of all promoters shall be obtained.

e) For replacement of high cost borrowings: 150% collateral security shall be offered.  For takeover of TL/WCTL from Banker TIIC norms shall apply.